Ride-sharing giant Bolt has launched a stinging critique of potential government plans to impose a 20 per cent VAT on all private hire journeys, branding the proposed measure "incredibly harmful" to the industry and its users.
Industry Backlash Against the 'Taxi Tax'
The controversial levy, dubbed a "taxi tax", is reportedly under consideration by the Chancellor as a means to raise funds for the upcoming autumn Budget. The move has sparked significant concern within the private hire sector.
Kimberly Hurd, Bolt's UK senior manager, stated that the tax would have a disproportionate impact, negatively affecting shift-based workers and vulnerable passengers the most. She argued that the additional cost would not only increase fares for riders but also severely harm drivers' livelihoods.
Bolt Flex: A New Driver-Led Feature
In response to mounting pressures within the industry, Bolt has rolled out a new feature called "Bolt Flex". This initiative is currently being trialled across nine UK cities and represents a significant shift in how fares are determined.
The feature allows drivers to set their own prices and enter into negotiations with passengers, moving away from the traditional algorithm-set fares. According to the company's own data, this new system is already yielding positive results for its drivers.
Bolt claims that since the introduction of Bolt Flex, drivers using the feature are earning over 25 per cent more and receiving 14 per cent more orders per hour. The company also emphasises that these gains for drivers have been achieved with only minimal price increases for passengers.
The Road Ahead for Ride-Sharing
The dual developments of a potential new tax and innovative pricing features highlight a period of significant flux for the UK's ride-sharing industry. The trial of Bolt Flex suggests a strategic pivot towards giving drivers more control and potentially higher earnings, even as the spectre of a government-imposed VAT hike looms over the entire sector.
The outcome of the government's final decision on the so-called "taxi tax" and the continued performance of the Bolt Flex trial in the nine cities will be closely watched by industry analysts, drivers, and passengers alike.
