How a Cab Charge Works

A cab charge is the amount you pay for a taxi ride, typically calculated by a taximeter using distance and time, plus any regulated extras like tolls or fees, and then settled via cash, card, mobile wallet, app, or—particularly in Australia—through a Cabcharge card, eTicket, or digital pass. In practice, the exact formula and any surcharges depend on local regulations, whether the fare is metered or a fixed tariff, and the payment method you use.

What “cab charge” usually means

In most places, “cab charge” refers to how your taxi fare is calculated and paid. It can also refer to Cabcharge, a branded taxi-payment system widely used in Australia for corporate and personal travel. Both concepts share the same core idea: your fare is determined by a regulated tariff (metered or fixed) and then collected through an accepted payment method.

How taxi fares are calculated

Most regulated taxis use a taximeter that calculates the fare based on a combination of distance traveled and time elapsed (including waiting in traffic). Jurisdictions publish tariff schedules that set the rates and allowable extras, and meters are calibrated and inspected by local authorities.

Typical components of a taxi fare

The items below outline what commonly goes into a cab charge. Specific names and amounts vary by city, state, or country.

• Flag fall/base fare: A fixed starting amount when the meter is activated.
• Distance rate: A per-kilometer or per-mile charge while the cab is moving.
• Time rate (waiting/slow traffic): A per-minute charge when speed drops below a set threshold or the vehicle is stationary.
• Minimum fare: A regulatory minimum you’ll pay even for very short trips.
• Time-of-day/day-of-week tariffs: Night, weekend, or holiday rates may be higher than daytime rates.
• Booking/pick-up fee: An extra set fee for phone/app bookings rather than street hails, where permitted.
• Zone or flat fares: Fixed prices for certain routes (e.g., airport to downtown), if set by local rules.
• Tolls and road/bridge charges: Passed through to the rider as incurred, often with receipt evidence.
• Extras: Locally allowed items such as additional passengers, large luggage, or pet transport; many places cap or prohibit these.
• Card payment surcharge: Where permitted, an added processing fee for non-cash payments (for example, in many Australian states this is capped at up to 5%); in some regions (e.g., the EU/UK for consumer cards) such surcharges are restricted or banned.
• Tax (e.g., VAT/GST): Included or added depending on local tax law, typically itemized on receipts.
• Tip/gratuity: Optional and custom-dependent; not included in most meters unless pre-set for account rides or large groups.

Together, these elements produce the final fare displayed at the end of your trip. The driver should be able to explain any line items and provide a receipt that matches the meter and applicable extras.

Step-by-step: what happens during a metered taxi ride

This sequence shows how a cab charge is created from start to finish in a typical metered taxi trip.

1. Hail or book: You either flag a taxi on the street or book through a phone/app. Booking may add a regulated pick-up fee.
2. Meter starts: The driver engages the meter at the beginning of the ride, applying the flag fall and the correct tariff (day/night/holiday as applicable).
3. Route and stops: The meter tracks time and distance. If you request stops or hit traffic, the time rate may apply.
4. Tolls/charges: Any tolls taken are added; drivers should choose reasonable routes or follow your preference if allowed.
5. Trip ends: At your destination, the driver stops the meter; the display shows the fare before extras.
6. Extras added: Permitted fees (tolls, booking fee, applicable surcharges) are added, and the total is presented.
7. Payment: You pay via cash, card, contactless, mobile wallet, app, or an accepted corporate/payment voucher.
8. Receipt: You can request a printed or electronic receipt itemizing fare, extras, tax, and total.
9. Disputes: If something looks incorrect, raise it immediately; you can also later contact the taxi company, regulator, or payment provider with the receipt details.

Following these steps helps ensure the fare is calculated under the correct tariff and that you receive documentation suitable for expense claims or disputes.

Fixed and flat fares

Not all cab charges are metered. Many cities set fixed fares for popular routes (such as airports) or allow zone-based pricing. App-booked taxis may also quote an upfront fare. In these cases, the meter may still run for regulatory compliance, but you pay the quoted amount unless your trip changes materially (e.g., extra stops or route changes beyond the quote’s conditions).

How payment works

Taxis typically accept cash and major cards, with widespread support for contactless taps and mobile wallets (e.g., Apple Pay, Google Pay). Some taxis also accept in-app payment if you booked through a network’s app. Card transactions may include a pre-authorization that temporarily holds funds; this usually clears or is adjusted to the final fare shortly after settlement. Always collect a receipt—paper or digital—for transparency and expense reporting.

About Cabcharge (Australia) and corporate taxi payment systems

In Australia, “Cabcharge” refers to a long-standing taxi payment system used by businesses and individuals to pay for rides without cash. Under the Cabcharge brand (now part of A2B Australia), passengers can use physical Cabcharge cards, eTickets/vouchers, or digital passes linked to corporate accounts. These products enable centralized billing, cost-center coding, and consolidated invoices, and they’re accepted by most taxi networks nationwide. Non-cash payment surcharges in Australian taxis are regulated and typically capped (often up to 5%), with itemized receipts provided.

Paying with a Cabcharge card or eTicket

Here’s how a typical Cabcharge transaction works in an Australian taxi.

1. Present your payment: Show a Cabcharge card, eTicket/voucher, or digital pass (QR/barcode) to the driver.
2. Driver selects non-cash on the terminal: The taxi EFTPOS terminal recognizes Cabcharge as a payment type.
3. Authorization: The terminal confirms validity and may request PIN or signature (for cards) or validation code (for vouchers/digital passes).
4. Add permissible extras: Tolls and regulated fees are included; any allowed surcharge is applied and itemized.
5. Receipt: You receive a tax invoice showing fare, extras, tax, and any surcharge; corporate references (job number/cost center) may appear if configured.
6. Settlement and invoicing: The back-end bills the linked corporate or personal account. Organizations receive periodic statements and can export data for reconciliation.

This flow makes taxi costs traceable for companies while keeping the rider’s checkout quick and largely cashless.

Fees and consumer protections in Australia

Most states and territories cap taxi non-cash surcharges (commonly up to 5%). Drivers must provide receipts on request, and fares must follow the regulated tariff. For issues, contact the taxi network, the payment provider (e.g., Cabcharge/A2B), or your state transport regulator, quoting the receipt number, time, and taxi plate.

Tips to avoid surprises

The following pointers can help you understand your cab charge before you pay.

• Check the tariff card: It should be displayed in the cab, listing base fare, per-distance and per-time rates, and allowed extras.
• Ask for an estimate: For longer trips, especially to/from airports, request a ballpark figure or a fixed fare if offered.
• Confirm tolls and surcharges: Ask whether toll roads will be used and whether a non-cash surcharge applies in your area.
• Use official apps or phone bookings: You may get an upfront fare, driver details, and an automatic receipt.
• Watch the meter: Ensure it starts at the beginning and reflects the correct tariff (day/night/holiday).
• Choose the route: If you have a preferred route, say so at the start; otherwise, drivers should take a reasonable path.
• Know local rules: Some places ban card surcharges on consumer cards; others cap them—policies vary by jurisdiction.
• Keep the receipt: It’s essential for expense claims and for resolving disputes.
• For corporate travel: Use approved cards or digital passes to ensure charges flow to the right cost center.

Following these practices reduces misunderstandings and helps ensure your fare aligns with local regulations and your expectations.

Frequently asked clarifications

Is a meter always required?

For licensed taxis, yes, in most jurisdictions. Some exceptions exist for fixed or zone fares (often for airport routes) or when an app provides an upfront price. Ride-hailing services generally use in-app time-and-distance pricing rather than a physical meter.

Do I pay for traffic jams?

Usually, yes. When the cab is moving slowly or stopped, the time-based component of the tariff applies. This is why estimated fares can vary with congestion.

Can drivers charge extra for paying by card?

It depends on local law. Many regions allow a capped processing surcharge (e.g., commonly up to 5% in Australian taxis). Others, including the EU and UK for consumer cards, restrict or prohibit surcharges. Always check the posted tariff or ask before paying.

What about tipping?

Tipping customs vary. In the U.S. and Canada, 10–20% is common. In the UK, rounding up or about 10% is typical. In Australia and New Zealand, tipping is optional and less common. In Japan, tipping is generally not expected. Follow local norms.

Summary

A cab charge is the final price you pay for a taxi trip, built from a base fare plus time-and-distance charges and permitted extras like tolls or booking fees, then paid via cash, card, wallet, app, or systems such as Cabcharge in Australia. Meters and tariffs are regulated locally, surcharges may be capped or banned depending on region, and receipts should itemize all components. If you confirm tariffs, understand extras, and keep your receipt, you’ll know exactly how your cab charge was calculated and how to contest it if needed.

How much does CABCharge charge?

Cabcharge does not charge drivers, owners or networks for supplying equipment for the payment processing system, instead charging passengers a 10% service fee.

Do taxis charge per mile or time?

Once your journey goes over six miles, the price per mile increases slightly for Tariffs 1 and 2, and decreases a bit on Tariff 3. Your final fare is based on either distance or time whichever results in a higher charge. So yes, if you’re stuck in traffic, your fare creeps up.

How are cab charges calculated?

Distance Travelled: Distance travelled is a key factor influencing the fare. It’s calculated using a taximeter, which measures the distance the taxi covers. The fare increases incrementally with the distance. Time Spent in the Taxi: Time spent in the taxi also contributes to the fare.

How do you use a CABCharge?

Ensure the taxi accepts Cabcharge before the trip begins.

1. Tap eTICKET: Tap the eTICKET on the payment terminal.
2. Tear eTICKET: Tear along the perforation – keep the small portion and leave the large potion with the driver.
3. Get a Receipt: Ask the driver for a receipt.