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Taxi fares in Finland rose 13% after 2018 deregulation

The chair of the Taxi Drivers Association says the organisation tried to warn policymakers of the risk of rising prices.

Keltainen taksikyltti taksin katolla.
The number of taxi licenses has even doubled in some of Finland's larger metropolitan areas. Image: Petteri Bülow / Yle

The average price of a taxi ride in Finland cost around 13 percent more last month than it did just before broad reforms to taxi industry laws went into effect in June 2018, according to Statistics Finland.

One of the main effects of the reforms was deregulation of taxi pricing schemes. After July 1, 2018, prices were no longer set by law and opened up for competition.

But the Taxi Drivers Association's chair, Kai Andersson, said a price increase was anticipated.

"[Price hikes] were an issue the association raised when the reforms were announced. That's what happened in Sweden when the sector was deregulated. But [those concerns] fell on deaf ears," Andersson said.

The increase in taxi prices was greatest in major growth centres, particularly in the capital region - where the sheer number of taxis have also seen significant growth.

The number of taxi licenses has even doubled in some of Finland's larger metropolitan areas.

However, despite the increase in competition in those areas, prices have risen and not fallen like former Prime Minister Juha Sipilä's administration said they would. The chief orchestrator of the reforms was former transport minister Anne Berner.

The relative number of licensed taxi drivers in smaller communities and towns remained steady or even declined. Nowadays there are fewer taxis operating than before the reforms rolled out in about 100 municipalities across the country.

In the first few months after the reforms, taxi fares did go down briefly, but not long after that, prices made a steady, upward creep. On average, taxi ride that cost 30 euros in the summer of 2018 now costs nearly 34 euros, according to Statistics Finland.

The number-crunching agency reports that the biggest price hikes were seen in southern areas of the country more than in northern and eastern regions.

Taxi Association calls for monitoring

The sector's deregulated — rising — pricing schemes are most noticeable during periods of high volume, such as major events and during the Christmas season. That's one reason why prices have gone up the most in larger cities, because more events are held there, according to the agency.

The taxi association's Andersson said that thanks to the removal of laws requiring taxi drivers to be on call at night, it has become more difficult for people in rural areas to get taxis in the evening.

Finland's current government, led by Prime Minister Sanna Marin, has vowed to re-examine the effects of the taxi law reforms and make adjustments to them this year. Before ascending to her PM post, Marin served as transport minister and last summer said, among other things, that the reforms worsened people's access to taxis.

The Tax Administration has expressed a desire for all taxi journeys to be metered. Following the reforms, taxi drivers have been able to set fixed prices for trips, prompting some officials to suspect an increase of a grey economy within the sector.

Andersson said that monitoring of the industry should be increased, saying that the taxi association wants taxi licenses to only be issued to drivers linked to companies with Business Identity Codes as a way to ensure that permit applicants are registered operators.

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