Transport Secretary Lam Sai-hung advocates for taxi rate increase to boost driver earnings and revamp industry standards

Lam Sai-hung

18th May 2024 – (Hong Kong) Secretary for Transport and Logistics, Lam Sai-hung, has confirmed an impending hike in taxi flag-fall rates, a move designed to counteract the decline in driver earnings since the onset of the pandemic. Set to take effect from 14th July, the increase will see the initial charge for red urban taxis rise from HK$27 to HK$29. Similar adjustments will apply to taxis operating in the New Territories and on Lantau Island, with new starting fares of HK$25.5 and HK$24 respectively.

During a radio interview on Saturday, Lam highlighted that a thorough analysis of taxi drivers’ incomes had prompted the decision. “Our findings revealed that monthly earnings for drivers last year ranged between HK$17,000 and HK$20,000,” Lam stated, noting a significant downturn when compared to pre-pandemic levels in 2019, particularly for those on Lantau Island.

The fare adjustment is part of a broader strategy to revitalise the taxi industry, which includes the introduction of a premium taxi fleet. This initiative aims to address the sector’s tarnished reputation, marred by instances of misconduct from a minority within the ranks, described by Lam as “a handful of black sheep.”

These premium taxis will be required to accept electronic payments and provide an effective mechanism for resolving customer complaints, with operators permitted to levy additional charges for bookings and other services. The move is anticipated to elevate service standards and restore public trust in the traditional taxi service.

Concurrently, the Hong Kong government is crafting a regulatory framework for ride-hailing platforms, expected to be unveiled mid-year, which will mandate the use of authorised vehicles only. This comes amid ongoing tensions with Uber, whose operations have been a point of contention due to the current legal requirement for a hire-car permit.