Metropolitan and country taxi fares will increase by 2.26 per cent from December 1, 2008 after a review into taxi industry operating costs concluded this month.

Transport Minister Simon O'Brien said the results of the Metropolitan Taxi Fare Model Review (MTFMR) were used to construct a new fare index, which was more reflective of taxi operators’ expenses.

“I am committed to improving the taxi industry for both drivers and customers,” Mr O’Brien said.

“We need taxi drivers and these drivers need a profitable industry.

“The fees charged should be in line with industry costs, such as petrol and vehicle servicing repairs.”

The Minister said the MTFMR had recommended a new fare model which determined an annual taxi fare increase of 6.18 per cent.

"Taking into account the 3.92 per cent interim taxi fare increase issued in July this year, the new increase effective on December 1 achieves the recommended fare model," he said.

Mr O’Brien said Christmas Day and New Year's Eve surcharges would also be adjusted to reflect the 6.18per cent increase.

In previous years, metropolitan and country taxi fares were based on the annual movement in the Private Motoring Index (PMI). In response to a request from the taxi industry, the MTFMR was implemented to more accurately assess future taxi fare increases.

“The fare changes mean customers will pay approximately 3 cents more per kilometre, or 40 cents more for an average Tariff 1 trip of 7.5 kilometres.”

The Minister said he had also increased the penalty for fare evasion from $100 to $250 as a greater deterrent.

DPI compliance officers would continue to take action against customers who evade fares.

“Customers should also be aware that the $1.50 call-out surcharge and $2.00 after midnight surcharge on Friday and Saturday nights will now automatically be placed on the meter instead of being requested at the end of the trip by the driver,” Mr O’Brien said.

“The Liberal-National Government strongly supports the taxi industry and will work to ensure taxi fares remain reasonable for both customers and operators.”

Minister's office: 9213 6400

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