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Treasury Reviews 20% VAT Rise on Minicabs as Bolt Pauses £200m UK Investment

The proposed hike could drive up fares for disabled passengers relying on minicabs for medical appointments.

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Overview

  • A High Court ruling reclassified private hire operators as service providers, triggering a consultation on adding 20% VAT to minicab fares.
  • Bolt says uncertainty over the so-called ‘taxi tax’ has led it to withhold £200 million of UK investment over the past three years.
  • Campaigners and Disability Rights UK warn the VAT increase would price out the 53% of disabled or chronically ill people who use minicabs for health appointments.
  • The Federation of Small Businesses and other trade bodies predict the levy could force 25,000 drivers off the road and weaken local high streets.
  • Data from Bolt shows a 62% surge in rides to Birmingham Children’s Hospital since January 2023, highlighting growing dependence on ride-hailing for essential journeys.