(KYIV, UKRAINE) – Ukraine’s taxi and ride hailing market is growing rapidly but more than 90% of drivers continue to operate outside the formal economy, according to a new study examining the economic impact of proposed reforms in the sector.
The Ukrainian ride hailing market generated about US$1 billion, equivalent to around UAH 46 billion, in 2025 after customers completed approximately 239 million taxi trips, an increase of 7% compared with the previous year.
The figures were presented by Maksym Terzi, an expert at the Urban Research Center of the Kyiv School of Economics, during a roundtable organised by the European Business Association.
The study identified approximately 172,000 individual taxi drivers operating across Ukraine. The market is highly concentrated, with major digital platforms controlling most customer bookings.
Uklon and Bolt together account for up to 85% of the market, while Uber represents around 7%. The remaining share is divided between smaller digital platforms and local taxi operators.
Researchers said the concentration of the market could make it easier for authorities to introduce reforms because most drivers already operate through large platforms. However, the study found a significant gap between the number of active drivers and those officially registered.
Although Ukraine has more than 170,000 taxi drivers, only around 9,500 vehicles are licensed to provide taxi services. This means only about 5.5% of drivers currently operate legally under existing licensing requirements.
Experts estimate that the informal nature of the sector causes the Ukrainian state to lose up to UAH 4.5 billion annually, equal to about US$97 million, £72 million and €83 million in unpaid tax revenue.
A planned taxi market reform aims to address this issue through changes to taxation of income earned through digital platforms. The legislation has already been approved by parliament but is awaiting the signature of President Volodymyr Zelensky.
Under the proposed tax system, digital platforms would be responsible for identifying drivers, recording income and collecting tax payments. The law would introduce a tax rate of 10% of income during the period of martial law and 5% after the war ends.
Drivers earning less than €2,000 per year, equivalent to about US$2,300 or £1,700, from occasional taxi work would be exempt from taxation. Authorities said the measure is designed to avoid placing unnecessary pressure on people who use taxi driving as a small additional source of income.
At the same time, the Ministry of Recovery, Infrastructure and Transport is preparing separate legislation covering the transport side of the taxi industry. The proposed framework would create a status for self employed vehicle operators without requiring drivers to register as traditional private entrepreneurs.
Under the planned system, taxi drivers would receive an electronic certificate after meeting basic requirements. Vehicles would be registered in a state database, undergo technical inspections and maintain insurance coverage.
Serhii Derkach, First Deputy Minister for Recovery, Infrastructure and Transport, said the government does not aim to create excessive regulation but wants to establish clear and simple rules for drivers and digital platforms.
He said taxi platforms should also share responsibility for ensuring drivers using their services follow safety, legal and insurance requirements.
According to researchers, successful implementation of the reforms could increase annual tax revenues from the sector to UAH 8 billion by 2030, equal to about US$173 million, £129 million and €148 million. The share of legally operating taxi drivers could also rise to 90% of the market.
The reform follows a decision by Ukraine’s parliament on 9 June 2026 to approve legislation introducing international automatic information exchange on income earned through digital platforms and establishing new taxation rules for the digital economy.
The changes are part of Ukraine’s wider commitments linked to cooperation with international partners, including the International Monetary Fund, the European Union and the Organisation for Economic Co operation and Development.
The government expects greater transparency in the taxi sector to improve tax collection while allowing digital transport services to continue expanding as part of Ukraine’s wider digital economy.