Treasury written question – answered at on 12 January 2026.
Andrew Snowden
Opposition Assistant Whip (Commons)
To ask the Chancellor of the exchequer, whether she plans to bring forward further reforms to VAT treatment within the taxi and private hire vehicle sector.
Dan Tomlinson
The Exchequer Secretary
Private hire vehicle (PHV) services provided by VAT-registered businesses are, and always have been, subject to the standard rate of VAT (20%).
The Government’s announcement at Autumn Budget 2025 puts an end to the exploitation of a VAT administration scheme, designed for the tour operator sector, by a small number of large private hire vehicle operators seeking to pay a lower rate of VAT than others.
This won’t affect smaller operators outside London whose drivers contract directly with passengers, or black cabs, neither of which have attempted to exploit this scheme.
Yes2 people think so
No0 people think not
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The chancellor of the exchequer is the government's chief financial minister and as such is responsible for raising government revenue through taxation or borrowing and for controlling overall government spending.
The chancellor's plans for the economy are delivered to the House of Commons every year in the Budget speech.
The chancellor is the most senior figure at the Treasury, even though the prime minister holds an additional title of 'First Lord of the Treasury'. He normally resides at Number 11 Downing Street.
