No solution to taxi fare conundrum: Josephine Teo


After almost one and a half years since the Government said it was reviewing the complicated taxi fare structure in Singapore, Senior Minister of State for Transport, Josephine Teo, told Parliament on Wednesday that “there was no easy solution to harmonise the fares.”

As such, “the best solution”, she said, “was to leave the fares as they are for now.”

tf2013In November 2013, Mrs Teo had responded to questions from two Members of Parliament (MP) about the complicated taxi fare structure and if this served commuters’ interest.

MP Liang Eng Hwa had also asked whether commuters are expected to scrutinise the type of taxis which they flag down before deciding to board the taxi.

In her reply then, Mrs Teo said she recognised that “the current taxi fare structure is complex and confusing for commuters.”

“LTA will work with the Public Transport Council (PTC) and the taxi companies to study if and how it could be made simpler and more easily comparable across different taxi companies, taking into consideration also the impact on taxi drivers, ultimately to have a taxi fare structure that best serves commuters’ interests,” she told the House then.

In December 2013, National University of Singapore transport researcher Lee Der Horng also chipped in on “the mind-boggling range of fares.”

In the current system, there are close to 10 different flagdown fares, three different metered fare structures, more than 10 different types of surcharges, eight types of phone booking charges, issued by some 30 types of cabs in at least eight different colours, across seven brands.

“There are currently four broad components to the structure – flag-down fare, unit fare, surcharges and booking fees. Unit fare accounts for extra distances travelled and time taken,” Channel Newsasia reported.

“The price mechanism has failed badly in the taxi industry such that it is operating like a perfect competition, whereby whenever one operator increase prices, the others will follow,” Dr Lee said. “If we are talking about luxury goods, it is their freedom to do so. But taxi industry’s position should be somewhere between public and private, so the Government cannot be blind to this.”

The announcement that the Government was reviewing the fare structure had raised the expectations of industry players.

tf2014A Straits Times report in December 2014 said “industry players [are] expecting higher flagdown rates, bigger interval jumps but pared down surcharges.”

Other changes which were speculated to be in the pipeline, as reported by the Straits Times, were:

  1. A standardised flagdown fare of $3.80, instead of rates ranging from $3.20 to $5 today.
  2. Distance- and time-based interval jumps will be a uniform 30 cents, instead of the 22, 30 and 33 cents in place today.
  3. Peak-hour surcharges will be dropped, but the midnight surcharge will remain, and location surcharges standardised.
  4. A flat monthly Electronic Road Pricing (ERP) levy of $150, regardless of the number of times a cabby crosses an ERP gantry.

The Land Transport Authority (LTA), however, had cautioned against raising hopes of a solution.

“The issue is complicated as the fare structure fundamentally reflects the different rental costs of different taxis. Different stakeholders, ranging from commuters, taxi-drivers to taxi companies, have different interests,” it said.


Mrs Teo’s confirmation that the failure to harmonise the taxi fare structure shows perhaps that the complexity of the problem has reached a point where it seems almost impossible to simplify.

For now, commuters will have to live with the complex fares and resign themselves to forking out whatever the meter or the taxi driver says.

Lau Sau Kuen, a marketing professional and regular taxi customer, told the Straits Times in October 2013, reflecting the fatalistic views of many: “It’s terrible we have so many types of cabs and so many different rates. I don’t know the rates any more. Just as I don’t know the different surcharges any more. I’m resigned to paying whatever the cabby tells me to at the end of a ride.”