From Chinese Press

Relieve pressure on taxi drivers

(China Daily)
Updated: 2011-02-24 07:38

Gas price in Beijing has risen to 7.45 yuan a liter. Should taxi fares be increased accordingly? A decision to increase taxi fare, however, cannot be taken in first half of the year because it would take at least six months for a draft to be implemented, says an article in China Youth Daily. Excerpts:

To ensure that the increased gas price doesn't cause unwarranted loss to taxi drivers, some central government departments have asked local governments to grant subsidies to cabbies.

But a cabbie can get only a certain amount as subsidy, which will not offset the higher gas price that he/she pays. Passengers should, therefore, understand the necessity of raising taxi fares.

In fact, even higher taxi fares will not relieve the pressure on taxi trade.

So instead of granting cabbies' subsidies, the government should establish a joint mechanism between taxi fare and oil price to ensure that fares go up when gas price rises and go down when the price falls.

Besides, taxi companies should shoulder some of the loss caused by higher oil price. Since they earn their revenue mainly through the daily quota of money handed in by taxi drivers, they should reduce part of the amount that cabbies pay them. This would minimize the loss suffered by taxi drivers.

The difference in the price of gas in different places has made it possible for some local governments to provide a certain amount of gas to cabbies at a special (or reduced) price.

Also, if taxi companies can rationally allocate taxis' running time to earn ideal revenue per car, it would help cover the loss caused by the rise in the price of gas.