Fares up but pay down?

Leong Sze Hian

I refer to the article, “How to help cabbies: cut fares or reduce rent?” (New Paper, Mar 6) and Paul Chan’s letter, “High cab rentals and surcharges akin to price fixing” (ST, Mar 4), and media reports that taxi ridership has been declining and that taxi drivers’ earnings are also dropping.

The Ministry of Transport has clarified that public transport fares are not linked to oil prices.

What about taxi fares? Is it linked to oil prices?

Since the price of oil has dropped a lot, and last year’s taxi fare hikes are being maintained, the question that may be on some Singaporeans’ minds may be whether the earnings of taxi drivers have increased?

I understand that there are more than a thousand taxis that are lying idle in warehouses.

This may be an indication that taxi drivers’ earnings may not have gone up very much. Otherwise, why are there so many taxis that nobody wants to rent?

In order to help taxi drivers in the deepening recession, I would like to suggest that the amount of road tax and COE rebates for unrented taxis that the taxi operators are getting, be given directly to all taxi drivers instead, to supplement their reduced earnings.

According to media reports in April, the largest taxi operator here with about 15,000 of the country’s 24,000 taxis, said that there was a 16 per cent increase in takings for a cabby’s full day of work. For a full-day shift, cabbies are earning $187.92, up from $162 before the fare revision, after deducting the cost of fuel and renting the cab.

“A cabby’s full day of work – for a full-day shift, cabbies are earning $187.92”, means that the monthly net earnings is about $4,510 ($187.92 times 24 days).

I have talked to some taxi-drivers and friends who are taxi drivers, and they tell me that those who work on two shifts, eight to ten hours a day, are earning about $2,000 or less a month.

For example, one of my friends drives about 14 hours a day, six days a week, to earn about $115 a day net after rental, fuel and parking, to earn about $2,800 a month.

So, is there something wrong with the monthly earnings figure of $4,510?

How are diesel prices and rebates determined?

Do taxi companies still make a profit on the sale of diesel, after the rebate?

How much does this profit amount to, relative to the individual earnings of drivers?

What is the tax on diesel? Is it the same 41 cents per litre like that for standard petrol?

With the recession, why not reduce the tax on diesel, since the originally projected Budget deficit has become a $6.4 billion surplus?

With the rising price of oil over the last year, how much more in diesel taxes were collected ?

Motor Vehicle Related Taxes and Vehicle Quota Premiums for FY 2007 was $2.7 billion.

This is an increase of about 47 per cent over FY 2006’s $1.84 billion.

In this connection, I would also like to suggest that the Land Transport Authority (LTA) re-consider its 10-year ban on granting taxi licenses to ex-offenders, which I estimate to be about 200,000 people.

Perhaps the only solution to taxi drivers’ declining earnings in the current recession is to reduce the road tax, COE, ERP and diesel tax for taxis.

Maybe taxi fares can also be reduced?

By the way, are there any other countries in the world that have road tax, COE and ERP on taxis? 


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