Singapore's taxi industry operates under a framework of regulations set by the Land Transport Authority (LTA). These rules cover everything from how a taxi gets a license to how much a driver can charge for a trip. The system aims to balance the needs of passengers for reliable, affordable transport with the viability of the taxi trade. Understanding these regulations helps both drivers and passengers navigate the system with confidence.
The LTA's approach has evolved over decades. In the 1990s and early 2000s, the taxi industry was tightly controlled with fixed quotas and standardised fares. Since then, deregulation has introduced more flexibility, but the core structure of licensing and fare caps remains. This article lays out the key rules as of 2025, focusing on taxi licensing categories, the mechanisms for setting fares, and how these rules affect the ride-hailing apps that many passengers now use.
Taxi Licensing Categories
Every taxi in Singapore must have a valid Taxi License (also called a Taxi Permit) issued by the LTA. The license is attached to the vehicle, not the driver. There are two main types of licenses: the Standard Taxi License and the Street-Hail Taxi License. The distinction matters because it determines where and how the taxi can pick up passengers.
Standard Taxi License
A Standard Taxi License allows the vehicle to pick up passengers in two ways: through street hails and through booking services (including ride-hailing apps). This is the most common type of license. As of 2024, there were approximately 14,000 Standard Taxi Licenses in circulation, held mainly by the larger fleet operators such as ComfortDelGro, SMRT, and Premier Taxis. These taxis are the familiar yellow ones you see on the roads.
To obtain a Standard Taxi License, the operator must meet several conditions:
- The vehicle must be less than 8 years old (measured from date of first registration).
- The vehicle must pass an annual LTA inspection at a designated inspection centre such as Vicom or STA.
- The operator must maintain a minimum fleet size of 200 taxis (for companies) or operate as an individual owner-driver with a single taxi.
- The taxi must be fitted with a fare meter that is calibrated and sealed by an authorised service centre.
- The taxi must display the LTA-issued license disc on the windscreen.
Individual owner-drivers are a shrinking group. In 2010, there were about 2,000 owner-drivers. By 2024, that number had fallen to under 500, as most drivers prefer to rent taxis from fleet operators to avoid the high cost of owning a vehicle that depreciates rapidly.
Street-Hail Taxi License
The Street-Hail Taxi License is a more restricted category. It permits the taxi to pick up passengers only through street hails, not through booking services or ride-hailing apps. This license was introduced in 2017 as part of a trial to allow private-hire cars (such as those used by Grab and Gojek) to operate as street-hail taxis under certain conditions. The trial ended in 2019, and the LTA did not renew it. As of 2025, no new Street-Hail Taxi Licenses are being issued, and existing ones have been phased out.
The key lesson from that trial was that allowing private-hire cars to street-hail blurred the lines between taxi and private-hire services, creating confusion for passengers and enforcement challenges for LTA. Today, all street-hail pickups are done by Standard Taxi License holders.
Fare Regulation and Caps
Taxi fares in Singapore are not set entirely by the market. The LTA imposes a fare cap structure that limits how much a taxi driver can charge for a trip. The cap applies to metered fares, not to dynamic pricing used by ride-hailing apps (which are regulated separately under the Point-to-Point Transport Act). For taxis, the fare components are defined in the LTA's Taxi Fare Formula.
The fare cap covers three main components: flag-down fare, distance charges, and time charges. Surcharges for peak periods, locations, and ERP are additional and are also capped. The LTA reviews these caps periodically, usually once a year, based on changes in operating costs such as fuel prices, COE prices, and labour costs.
Flag-Down Fare Cap
The flag-down fare is the base amount charged when the meter starts. As of January 2025, the cap for a Standard Taxi License is SGD 4.50 for the first 1 km. This applies to all taxis, regardless of operator. Some operators may choose to charge less than the cap, but they cannot exceed it. ComfortDelGro, for example, charges the full SGD 4.50, while some smaller operators might offer a slight discount to attract passengers.
For more details on how the flag-down fare is structured and what it includes, see our article on flag-down fare breakdown.
Distance and Time Charge Caps
After the first 1 km, the meter charges a per-kilometre rate. The cap as of 2025 is SGD 0.25 per 400 metres (equivalent to SGD 0.625 per km) for distances up to 10 km. For distances beyond 10 km, the rate drops to SGD 0.20 per 400 metres (SGD 0.50 per km). This taper is designed to make longer trips more affordable and to encourage drivers to accept long-distance fares.
Time charges apply when the taxi is moving slowly or stopped, typically below 20 km/h. The cap is SGD 0.25 per 45 seconds of waiting time. This is equivalent to SGD 20 per hour of stationary time. The time charge compensates the driver for lost revenue in traffic jams.
For a full breakdown of how distance and time charges accumulate, read our article on distance and time charges.
ERP Surcharge Caps
The Electronic Road Pricing (ERP) surcharge is a pass-through cost. When a taxi passes through an ERP gantry during a trip, the fare meter automatically adds the ERP amount to the fare. The LTA caps the ERP surcharge at exactly the ERP toll amount. The taxi operator cannot add any administrative fee on top. This rule ensures that passengers only pay the actual ERP cost incurred, not a markup.
For a detailed look at how ERP surcharges apply to taxi trips, see our article on ERP surcharges for taxis.
Peak Period Surcharge Caps
Peak period surcharges apply during morning and evening rush hours. The LTA caps these surcharges as follows:
- Morning peak (6:00 AM to 9:30 AM on weekdays): SGD 1.00 per trip.
- Evening peak (6:00 PM to 11:30 PM on weekdays): SGD 1.00 per trip.
- These surcharges apply to all metered trips, including those booked via apps.
Some operators have requested higher caps in recent years, citing increased demand during peak hours, but the LTA has kept the caps unchanged since 2015. The rationale is to keep taxis affordable for commuters who rely on them for work.
For more on when these surcharges apply and how to avoid them, read our article on peak period surcharges.
Airport Surcharge Regulations
Changi Airport and Seletar Airport have their own surcharge rules, which are set by the LTA in consultation with the airport operators. These surcharges are separate from the fare caps and are added to the metered fare.
For trips starting at Changi Airport (Terminals 1, 2, 3, or 4), the airport surcharge is capped at:
- SGD 3.00 for standard taxi trips.
- SGD 8.00 for premium taxi trips (such as London cabs or maxi-cabs).
For trips ending at Changi Airport, there is no surcharge, but the driver may choose to add an ERP surcharge if they passed through an ERP gantry on the way.
At Seletar Airport, the surcharge is capped at SGD 3.00 for all trips starting from the airport. This lower cap reflects the smaller volume of passengers and shorter average trip distances.
For a complete guide to airport surcharges and how to navigate them, see our article on airport surcharges at Changi.
Ride-Hailing App Regulations for Taxis
When a taxi is booked through a ride-hailing app such as Grab, Gojek, or Tada, the fare is not subject to the same caps as a metered street-hail trip. The LTA regulates ride-hailing fares under the Point-to-Point Transport Act, which allows dynamic pricing. However, there are rules to protect passengers.
First, the app must display the estimated fare before the passenger confirms the booking. This fare estimate must be based on the route and current demand, and the final fare cannot exceed the estimate by more than 10% (unless the passenger agrees to a change, such as a detour). This rule prevents fare gouging after the trip starts.
Second, taxis that accept bookings through apps must still have a functioning meter. If the passenger requests a metered fare instead of the app's dynamic price, the driver must comply and charge the metered rate plus any applicable surcharges. This option is rarely used in practice, but it exists as a consumer protection measure.
For a comparison of how different apps handle taxi bookings and pricing, see our articles on Grab vs Gojek pricing and Tada vs Zig review.
Licensing Requirements for Drivers
Drivers who operate taxis must hold a Taxi Driver's Vocational Licence (TDVL). The TDVL is issued by the LTA after the driver passes a medical examination, a background check, and a written test on taxi regulations, road safety, and customer service. The test is administered by the Singapore Taxi Academy (STA) and costs SGD 120 per attempt as of 2025.
The TDVL must be renewed every three years. Renewal requires a medical examination and a refresher course at the STA, which costs SGD 80. Drivers over 75 years old must renew annually and pass a more stringent medical check.
For private-hire car drivers (those who drive for Grab, Gojek, etc.), the equivalent licence is the Private Hire Car Driver's Vocational Licence (PDVL). The PDVL has similar requirements but does not allow the driver to accept street hails. The LTA enforces this distinction strictly. A PDVL holder caught picking up a street hail faces a fine of up to SGD 1,000 and possible suspension of the licence.
Enforcement and Penalties
The LTA enforces taxi regulations through routine inspections, spot checks, and investigations of complaints. Inspectors from the LTA's Enforcement Branch have the authority to stop taxis, inspect the vehicle and meter, and request the driver's TDVL. If a taxi is found to have an unsealed or tampered meter, the operator faces a fine of up to SGD 5,000 per offence. Repeat offenders can have their Taxi License revoked.
For overcharging, the penalty is a fine of up to SGD 1,000 for the driver and SGD 5,000 for the operator. The LTA also maintains a public hotline (1800-2255-582) for passengers to report fare disputes. In 2023, the LTA received 2,340 complaints about taxi fares, of which 1,100 were found to be valid and resulted in warnings or fines.
Recent Changes and Future Trends
In 2024, the LTA announced a review of the Taxi Fare Formula, with a focus on adjusting the distance charge taper to reflect higher fuel costs. The review is expected to conclude in mid-2025. Industry groups such as the National Taxi Association have proposed raising the flag-down fare cap to SGD 5.00 and increasing the peak period surcharge cap to SGD 2.00. The LTA has not yet indicated whether it will accept these proposals.
Another trend is the gradual shift from street-hail to app-based bookings. In 2019, street hails accounted for 55% of all taxi trips. By 2024, that figure had dropped to 30%, with the rest coming from apps. This shift is putting pressure on the LTA to reconsider whether the current fare cap structure, which was designed for metered street-hail trips, remains appropriate for a market dominated by app bookings.
For passengers who want to save money on taxi trips, understanding the regulations can help. Booking during off-peak hours, avoiding airport surcharges by taking a shuttle, and comparing app prices can all reduce costs. For tips on cutting your taxi bill, see our article on how to save money on taxis in Singapore.
If you are a frequent traveller to Changi Airport, our Changi Airport taxi guide provides detailed information on taxi stands, surcharges, and alternative transport options.
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