If app-based and traditional private hire fares have looked a little different since the start of 2026, there's a specific reason: a change to how VAT is charged on private hire journeys across the UK, not just a general price rise.
Any prices referenced are estimates that vary by operator and journey — this article explains a tax policy change, not MiniCabFinder's own pricing.
What actually changed
Previously, ride-hailing platforms could account for VAT under a scheme that only taxed their commission — the margin they took, not the full fare. From 2 January 2026, that treatment was removed for private hire operators, meaning 20% VAT now applies to the full cost of the journey rather than just the operator's cut. This is a nationwide change to how private hire is taxed, and it applies to app-based platforms and traditional licensed minicab operators alike — not just one company.
Why this matters if you're comparing Uber vs a licensed taxi partner
Before this change, a meaningful part of the app-based pricing advantage came from that narrower VAT treatment. With VAT now applied to the whole fare, the gap between app-based dynamic pricing and a traditional pre-agreed private-hire quote is narrower than it used to be — and during surge periods, a fixed quote from a licensed taxi partner can work out more predictable either way.
What to actually compare now
The VAT change doesn't change the practical advice, it reinforces it:
- Dynamic pricing (apps) can still spike during demand, bad weather or events — VAT is applied on top of whatever that number is at the time.
- A pre-agreed private-hire quote is fixed before you travel, so you know the final number — including VAT — before the driver sets off.
- For planned journeys — airport transfers especially — getting a quote in advance now matters more, not less, since neither option is immune to the VAT increase.
Where this leaves airport transfers specifically
Airport runs are exactly the journeys where fixed pricing has always mattered most, because they're plannable in advance and the distances are long enough that a metered or surge-priced fare can move significantly. If you're comparing options for a run like Heathrow to central London or London to Gatwick, getting a like-for-like estimate before you travel is the way to see where you actually stand once VAT is factored in on both sides.
For the fuller breakdown of how taxis, minicabs and app-based private hire differ beyond pricing, see our taxi vs Uber comparison.
MiniCabFinder is a comparison service, not a taxi operator, and does not set the final fare. Compare an estimated fare from a licensed local taxi partner before you travel.