3 pieces of GOOD news for the South African taxi industry

There have been three major developments in the South African taxi industry in recent weeks. Firstly, government announced it will scrap nearly 2 000 illegal/unroadworthy minibus taxis. Likewise, there is a directive to convert approximately 400 vehicles to alternative fuels, too.

This progress in the South African taxi industry is all part of a ‘Taxi Recapitalisation Plan’ that was presented in parliament last month (Tuesday 20 May 2025). As such, government’s broader mandate is to finally modernise the industry through various projects.

SOUTH AFRICAN TAXI INDUSTRY REFORM

Like them or loathe them, the South African taxi industry is the lifeblood of the country’s economy. More than two thirds (66%) of the nation relies on public transport to get to and from work each day.

As such, another piece of good news is that the South African National Taxi Council (SANTACO) won’t raise fares this month. When the Minister of Finance Enoch Godongwana hiked the General Fuel Levy (GFL) for the first time in three years, it was widely anticipated that taxi fares would increase in June 2025. This would add yet more financial pressure to the country’s poor.

Effective from this month, the GFL increased by 16c per litre and 15c per litre for petrol and diesel respectively. As a result, the total cost of GFL is R4.01 per litre for petrol and R3.85 per litre for diesel. That taxi fares are unmoved is a remarkable turn of events when you remember that the Carbon Levy increased by 3c per litre back in April, too.

MINIBUS TAXIS GOING GREEN

Furthermore, new Liquid Petroleum Gas (LPG) conversions will lower the cost of fuel for taxis by as much 35%, reports BusinessTech. The department says LPG is the most viable alternative fuel because of the ease of conversion for minibus taxis. Better still, LPG runs cleaner, providing a longer engine lifespan and less maintenance. The option of dual systems is also viable for long-range commutes. At last count, the department says only seven taxis have converted as part of the LPG pilot project. It hopes to install 400 conversion kits.

Finally, stakeholders in the South African taxi industry are once again encouraged to take advantage of the Taxi Recapitalisation Projects (TRP). Government says voluntarily surrendered unroadworthy minibus taxis will be scrapped free of charge. And owners/operators will gain access to an allowance which they can recapitalise on a new taxi. The department believes there are as many as 2 350 illegal/unroadworthy taxis still operating in South Africa.

CAN THE MINIBUS TAXI INDUSTRY TRULY REFORM?

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