Italy held hostage by ‘mafia-like’ taxi lobbyhttps://www.euractiv.com/section/politi ... axi-lobby/Now that Italy has lifted the 20-year ban on new taxi licenses, the same old winners are cashing in.
Despite numbering only around 25,000 to 30,000 drivers nationwide, taxi drivers have maintained their privileges under a regulatory framework that has remained largely unchanged since 1992.
A powerful lobbying group that managed to block any sector liberalisation and influence many Italian governments.
"Even a technocratic government with a reformist like Mario Draghi couldn't overcome their influence," Andrea Giuricin, a transport economist at the University of Milan-Bicocca, told Euractiv.
To maintain their monopoly, they have often staged mass protests and resorted, in some cases, even to violence to demand further restrictions on private hire vehicles (NCCs).
"They are the only group that has managed to reach the Italian Parliament and Senate with makeshift bombs, facing little to no opposition from law enforcement," said Matteo Hallisey, president of +Europa, to Euractiv.
"When they mobilise, their ability to paralyse politics is evident."
A private asset
At the heart of the issue is a market artificially restricted for decades, where entry is nearly impossible. Cities like Milan and Rome haven't issued new licences in over 20 years, while Livorno holds the record: no new permits since 1975.
Once handed out for free as a public service, licences became a private asset of the lucky few and their heirs, who kept profiting from their sale. Today, they sell for up to €200,000 – and as much as €400,000 in Venice.
This contrasts with France, where anyone can apply for a taxi licence after passing an exam.
In Italy, a 2023 law increased the number of licences by 20% across major cities, with new taxi drivers having to pay a fee to obtain one. In Rome, the cost of a new permit is set at €75,500 and in Milan, it reaches €96,500.
While under a previous arrangement, 80% of the revenue went to taxi drivers and 20% to municipalities, Meloni's government decided that now 100% would go to the existing drivers.
This is likely a political concession to secure their support, according to Giuricin and Hallisey.
"The absurd part is that even those who originally got their licences for free will now receive financial compensation," Giuricin explained.
Not to mention that, despite the increase, the number of taxis in Italy – already well below the European average – will remain insufficient to meet demand, making the impact barely noticeable, he added.
Tax evasion
Another issue plaguing the Italian taxi sector is tax evasion, as the sector's profits are higher than officially reported. "If you look at official tax returns, the average annual gross income for a taxi driver in Italy is €15,000 – about €1,200 per month. Some drivers, however, have declared as little as €700 per month," Giuricin said.
"If taxi licences are worth between €200,000 and €250,000, something clearly doesn’t add up."
For years, all taxis have been required to have POS systems that allow passengers to pay using the method of their choice, whether cash or online.
But Hallisey explained that “this requirement is still often ignored by taxi drivers to avoid traceable payments," following his investigation across Italian cities.
In Bologna, for example, taxi driver Roberto Mantovano, also known as 'Red Sox,' has openly admitted to being part of this "taxi mafia" for years after disclosing his real earnings and the tactics used by taxi drivers in a book, Hallisey added.
"After he decided to expose what was happening in his industry, his car was vandalised several times."
Blocking competition
Subsequent Italian governments, under pressure from the lobby, have made it nearly impossible for services like NCC to thrive. For instance, recent regulations require a mandatory 20-minute waiting period between rides for NCC drivers, a rule that effectively limits their ability to compete with taxis.
"You pick up a customer, and since it could compete with taxi drivers, you have to stay parked for 20 minutes. Instead of expanding supply, the government is reducing it," Giuricin said.
While EU laws allow member states to regulate services like taxis, the EU top court ruled last year that regulations cannot be too rigid for rental vehicles solely to protect the taxi industry.
The Italian Constitutional Court referred to this ruling when it annulled the restriction on new NCC licences in 2024. This was a significant shift, as the government’s long-standing refusal to issue new permits was deemed unconstitutional.
"The Court even went so far as to state that the decisions taken by various governments were violating the fundamental right to mobility of citizens,” he said.
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