Passengers may have to pay a one-yuan (US$0.12) fuel add-on fee each time for taxi services in Guangzhou from September, as the city's pricing bureau was to submit the fuel surcharge plan to the municipal government for approval later this month.

Vice-director Wu Linbo of the pricing bureau said they would not hold a public hearing for the surcharge plan because the add-on fee was not charged on the taxi service itself and could not be counted as a taxi fare hike.

A taxi driver welcomed the move saying the two lifts in oil prices in June and July cost him 500 yuan more a month.

The city's taxi industry association sent a proposal to the pricing bureau in April calling for a fuel surcharge during oil price hikes to relieve the pressure on drivers, the New Express said. The proposal was shelved for further investigation then.

Wu said Thursday the high oil price was likely to remain in the long term and the fuel surcharge was a feasible resolution to reduce the cost pressure on taxi drivers. He said his department was still researching on a balanced scheme for the surcharge compromising the interests of passengers and taxi drivers.

Many residents were strongly against the surcharge saying the taxi fare was already expensive. "The profit margin for the taxi industry is fairly big," an ad agent said, "only drivers take a small share in it." He proposed the government and taxi companies made a concession by charging drivers less for license fees.

Shanghai's city government offers a 550-yuan (US$67.8) monthly subsidy for taxis running 24 hours a day and 462.5 yuan for those running on the dayshift alone starting August.

Meanwhile, the provincial bus station installed a 5 percent hike on 10 long-distance bus routes Saturday to combat the rising cost of fuels.

Editor: Wing