Minibus taxis wave goodbye to cash in one of South Africa’s biggest cities

The Cape Organisation for the Democratic Taxi Association (Codeta) has officially introduced a new cashless payment system for the local minibus taxi industry.

The new system was introduced on 1 June 2026 and requires commuters to use cards that are scanned when they enter the taxis.

“We are introducing a new cashless system in our taxi industry. Our customers will now be using cards, which they will scan when getting into our vans,” said Codeta chairperson, Nceba Enge.

“By doing so, we are also trying to protect them in the morning when they are going to work and when they are coming back home,” he said.

Enge explained that cameras are being installed inside taxis to improve safety and accountability within the industry.

He added that the transition to this new technology is likely to present challenges during the initial implementation stages,

While some commuters have welcomed the new system, others have voiced concerns about how it will function in practice.

Taxi commuter Esethu Saliwa said the new payment system is a positive development, pointing out that similar systems are already in use in other forms of public transport. 

At the same time, she noted that commuters may initially find it difficult to plan their taxi fares using cards instead of cash.

She asked for taxi drivers to be patient with passengers as they adjust to the new system.

“These systems will have challenges, and sometimes the devices might not scan. Taxi drivers should exercise caution and patience with commuters,” said Saliwa.

An untaxed industry

South Africa’s taxi industry generates between R90 billion and R100 billion every year, yet it pays virtually no taxes.

It is a major component of the country’s informal economy, as taxi fares are paid in cash with little to no record-keeping, making it impossible to tax.

In March 2025, Wayne Duvenage, CEO of the Organisation Undoing Tax Abuse (OUTA), claimed that formalising and taxing the taxi industry could significantly increase state revenue.

He said that bringing the taxi industry into the tax framework would help to expand the nation’s tax base.

“It’s not to punish the taxi industry. It’s to say you are formalised, you are businesses, you need to be brought into the net,” he said.

The CEO added that there is no valid reason for the taxi industry to remain untaxed.

The Democratic Alliance has spoken about this issue before. In 2021, it was highlighted that this multi-billion-rand industry only pays R5 million in taxes.

This low tax-compliance rate was disclosed in response to a parliamentary question by the DA.

“The Minister of Finance has revealed that only approximately R5 million in tax is collected from the entire minibus taxi industry,” the DA said.

“This means that the vast majority of taxi operators and owners are declaring no corporate tax income at all and are not paying payroll tax for their drivers and employees.”

It is illegal to under-declare income and avoid paying taxes. This is considered a crime under the Tax Administration Amendment Act and can result in a prison sentence of up to two years. 

The DA urged the South African Revenue Service (SARS) to take action against tax evaders in the taxi industry and ensure that the sector pays its fair share.

However, this is difficult because of the cash nature of the industry, as SARS often lacks the financial documents needed to assess an operator’s taxable earnings.