The main reason why taxi fares in S’pore is so expensive (whose fault is it?)


Last Updated on 2017-11-23 , 7:14 pm

Over the years, everything has become more expensive, from your kang kong to your Prada bag. So it comes as no surprise that taxi fares have been increasing in the last few years—not that we are any happier about it, of course.

When it happened, we start complaining about how our hard earned wages are getting “eaten”, about how everything cost more but our wages remained the same and more. But one thing we have forgotten to ask, or maybe we didn’t bother to, is why it happened. Is it the cost of fuel?

Well, fuel prices have dropped but hey, surprise-surprise, the taxi fare hasn’t. In fact, the only place we saw prices drop back down once supply increases are probably FairPrice (just think back to the egg price hikes and subsequent fall).

Taxi commuters pay an average of $10, for a distance between Yishun and Kovan which is approximately 20 km. However, this does not include your peak hour surcharges, booking charges, location charges and so on and so forth. It’s no wonder that we prefer to go along with Uber/Grab, as long as there’s no crazy driver. So is it the taxi drivers’ fault or is there more to it?

Peak hour surcharge
Okay, peak hour surcharge is a killer. Agreed? Look at the diagram below.


Want to know what’s the killer? Taxi drivers have to adhere to this surcharge. What about Private car hires like Uber and GrabCar? They don’t have to. Instead, they operate with a demand-supply surge-pricing model, which many Singaporeans prefer because they can choose whether they will want to pay for the charges, instead of being forced to accept them.

High rentals
According to, taxi drivers are paying ridiculously high rentals due to taxi companies charging higher to earn profits. The prices range from $69/day to $103/day which is pretty high for someone who drives a taxi for a living. Taxi rentals can even go up to $140/day!


Imagine how many commuters you have to pick up to cover the rental. And we are not including fuel and other miscellaneous charges, including earning enough to bring home for the family.

Profit-driven Taxi Operators and Obsolete LTA Taxi Availability Standards Push Taxi Rentals and Fares Up
LTA imposes taxi availability (TA) standards, so taxi drivers must drive 250 km a day and be on the roads during peak periods, and taxi operators have to spend money to hire staff to do “police checks” on taxi drivers who don’t meet targets.

These TA standards used to make sense when there was no Uber and Grab, leaving commuters at the mercy of taxi drivers who “disappear” before midnight. But with more choices, are these TA standards still relevant? If cannot find a taxi, just book Uber/Grab lor.


Highlighting this unproductive cycle which negatively affects taxi drivers and commuters, Ang Hin Kee of the National Taxi Association wants LTA to remove these obsolete TA standards. Because if taxi drivers don’t hit these KPIs, LTA will fine taxi operators, who will then raise the cost of taxi rentals and taxi fares to gain back the money lost from adhering to LTA’s rules.


So we are actually paying out of our own pockets for LTA’s archaic regulations to be enforced when it doesn’t necessarily translate to more taxis available. In fact, Mr Ang says taxi companies should invest in technology to make their taxis more accessible to commuters.

This is more productive than making taxi drivers drive around for the sake of hitting KPIs, which wastes petrol and time. But we don’t know yet if LTA will own self review own self, or if taxi companies will ownself improve ownself. It’s not a simple case of “who ask them charge so high? Bodoh.”

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Top Image: DoublePHOTO studio /

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