Canberra Airport - Rego ACT - ACT Government

6. Licence Fee
In order to improve the quality of service of the taxi industry while at the same time releasing
more plates, it will be necessary to substantially lower the annual licence fee charged by the
ACT Government. The annual licence fee of $20,000 is currently causing higher fares, lower
returns to investors, and lower incomes earned by drivers, consequently resulting in
reductions in service quality while limiting the ability of the Government to issue more plates.
In our opinion the licence fee should be reduced from $20,000 to $1,500 per annum, but in
any event it should not exceed $5,000 per annum in any circumstance. To ensure equity
across the industry this reduction should apply to both existing and new taxi licences, and to
ensure that the full benefit of this reduction is passed on to drivers and investors, Canberra
Airport submits that the current fare levels should not be reduced.
The reality is that the loss to the community and to the city through poor quality of service
and lost business is much greater than the revenue lost by the Government through this
proposed reduction in licence fees. It is a taxing impost on an undersupplied industry that is
reducing the number of taxis that can viably and sustainably afford to operate in the market.
A reduction in the fee in this way is consistent with the Henry Review Tax Reforms.
In relation to Peak Period Plates, it is recommended that the licence fee is set at no more than
$500 per annum.
As an alternative to reducing the licence fee with immediate affect, this reduction could be
phased in gradually over the next five to seven years, with an immediate reduction to $15,000
per annum, then a reduction to $10,000 per annum in two years time, followed by a reduction
to $1,500 per annum two years after that.