JEREMY Hunt today vowed to "keep fares down" ahead of a consultation on the hated taxi tax.
From tomorrow drivers and riders will be asked for their views on a new levy that would hike ride-share prices for millions.
Minicab firms have warned a taxi tax would be detrimental to Brits who rely on services such as Uber and Bolt to get around.
The Chancellor said: “Time and time again we have proven that we are on the side of hard-working Sun readers.
"Cutting National Insurance by a third, extending the fuel duty cut and freezing alcohol duty.
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“We will always support passengers, and they can be assured that we will use this opportunity to keep fares down.”
A High Court ruling last year involving ride-hailing app Uber exposed private hire taxi firms to 20 per cent VAT on full fares.
The industry warns that could mean passengers being stung for an extra £4million a day.
Treasury officials say fare increases would work out to around £2.70 to £5.60 per year for the average passenger.
The 16-week consultation launching tomorrow presents passengers and firms with a range of options to swerve the tax - or lessen its impact.
One option is to change VAT laws so the levy can be scrapped entirely.
Another is to keep the tax but broaden existing transport discount schemes that have been designed to support more vulnerable consumers, such as the disabled person’s bus pass.
If the taxi tax goes ahead, the Treasury has also proposed introducing "zero-rating demand responsive transport", where small vehicles such as minibuses are dispatched in response to demand to complement buses.
The busses wouldn't operate to a fixed timetable and their route would vary depending on pick-up and drop-off locations.
A spokesperson for the Stop the Taxi Tax campaign said: “This is a positive step - we welcome the Chancellor's commitment to Stop The Taxi Tax for people up and down the country.
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"We now need to see the Treasury outline a VAT regime for our sector, that is in line with other forms of passenger transport such as trains, buses, coaches and flights.
"Until these details are confirmed, this damaging and unwanted VAT hike will still be hanging over everyone that relies on essential minicab services. ”
