New VAT Rules Hit Private Hire and Taxi Operators, Excluding Them from Tour Scheme

• From January 2, 2026, private hire vehicle and taxi services will be excluded from the Tour Operators’ Margin Scheme (TOMS), making them subject to full VAT.
• The government claims this change will benefit traditional taxi drivers and small operators, who have previously paid full VAT while online firms benefited from the scheme.
• Traditional taxi associations support the change, calling it a step toward fairness, while Uber criticizes it as “absurd” and inconsistent across regions.
• The government will introduce legislation to clarify and enforce this VAT change, affecting businesses that buy and resell taxi or private hire journeys.

Source: mirror.co.uk

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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