The Transport for London Board approved a taxi fare increase of 5.3 per cent at a meeting on 2 February 2012. Taxi fares are subject to an annual review and are calculated using a long-established formula based on the costs associated with working as a licensed taxi driver.
The Board also approved a 20 pence increase to the £2.20 flag fall - which is the minimum fare applied to the meter when a passenger gets into the taxi. This increase will apply across all tariff bands and is the first increase to this fee since 2005.
In the last year the price of fuel and the cost of insurance have both increased by 16 per cent. Taxi fares are reviewed annually and calculated by TfL based on a cost index that has been used since 1981. The new taxi fares will come into effect from 14 April 2012.