Government will not abolish tax relief for late-night taxis

The government has changed its mind on withdrawing the tax relief for late-night taxis.

In October 2011, the government tasked the Office of Tax Simplification (OTS) with identifying all the tax reliefs, allowances and exemptions, for employers and employees, and review what should be done with them.

The OTS recommended that the tax relief for late-night taxis be withdrawn. In the Budget in March 2011, the government accepted the recommendation. However, it has now changed its mind, following a consultation on the abolition of certain tax reliefs.

The government’s consultation said: “Based on the new information provided in the consultation, the government undertook further analysis to assess the equalities impact on vulnerable groups as well as the administrative burden that employers would face as a result of the repeal.

“New analysis has shown that repeal risks having a disproportionate impact on women, and could increase administrative burdens, therefore working against the government’s objectives for tax simplification.

“Based on this assessment, the government has decided not to abolish this relief.”

The relief provides income tax and national insurance (NI) exemptions for employees who are provided with a taxi to travel from work to home if they are required to work later than usual.

Read more articles on tax relief for employers and employees