Nearly 90 per cent of NSW residents don't know about a new $1 levy that will be added to every taxi and rideshare trip, no matter how short, finds a survey by ride-sharing company Uber which opposes the additional fee.
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Legislation introducing the new $1 levy, which will be imposed for a set period of five years, is scheduled to be debated and likely passed by State Parliament this week.
It will raise $254 million to compensate owners of taxi plates for the falling value of their businesses since the industry was deregulated and ride-sharing services such as Uber were legalised. The date when the fee will be introduced hasn't been set.
While the value of taxi plates has nearly halved, research by Deloitte Australia and the Independent Pricing and Regulatory Tribunal (IPART) show the market for "point to point services" has expanded.
Taxi bookings rose 5 per cent in the year to March 2016, Transport Minister Andrew Constance told Parliament earlier this month. Three times as many people – 2200 people in total – had applied to become taxi drivers since the government legalised Uber in December compared with last year, he said.
IPART also found that taxi use had increased in the past year; 61 per cent of people had used a cab in February 2016 compared with only 55 per cent a year ago. It also reported a rise in all point-to-point transport, suggesting the overall market had increased, reaching people who previously didn't use these services.
Uber argues that ridesharing does not capture markets, it creates them.
A spokesman said on Friday that Uber didn't believe any government should put expensive levies on consumers to compensate an industry that still had exclusive access to the majority of the point-to-point transport market.
Governments had said they wanted to provide consumers with more affordable transport options: "We are unclear, therefore, how raising fares for the travelling public by imposing a levy on every trip aligns with this stated objective," said the spokesman.
Uber argues that compensating taxi licence holders – who are benefiting from a growing market – amounts to "double dipping".
But Roy Wakelin-King, the chief executive of the NSW Taxi Council, said it was highly inaccurate and disingenuous "to say we are double dipping".
The average value of a taxi plate (or licence) had fallen 40 per cent from $375,000 to $206,000, and it was "fundamentally fair and right" to compensate taxi plate owners who had been hurt by structural reform.
"If your house value decreased by that amount, you would be concerned. I am not one to catastrophise, but for mum-and-dad owners and other operators it is a significant impact on their livelihood," he said. "I would struggle to see how losing 40 per cent of your capital value and commensurate income is seen as a benefit. These aren't people who are wealthy ... they are living very modest livelihoods," he said, adding that most had worked long hours with tight margins.
Of the 4000 people who own taxi plates, more than 90 per cent are considered mum-and-dad companies, owning and often driving one or two of their own cabs.
Uber's survey found 89 per cent of NSW residents were unaware of plans by NSW and others (South Australia has announced a similar levy) to introduce the $1 surcharge on all trips by taxis, rideshare services such as Uber, and hire cars.
About 70 per cent of people surveyed opposed the levy and a similar amount agreed that consumers should not have to compensate the owners of taxi plates for the falling value.
Cab driver James Yang was surprised to hear of the new levy. "Nobody's talked about it, and there's been nothing in the news," said Mr Yang, who has been driving for 20 years and sold his taxi licence a few years ago. He sold his taxi licence five years ago for a profit, but he says if he had sold it today he would have lost half his money. He said Uber's introduction had really affected him and other drivers, especially on Saturday nights. "We lose a lot of work."
