Generally speaking, a tip, or gratuity, is not required. A tip for a taxi driver should be based on the service the passenger receives, given in appreciation of friendly, timely service and assistance with directions, advice and baggage. A tip is acknowledgment of a job well done.
Tipping a taxi driver can be calculated in a flat amount or as a percentage of the fare. Many passengers round up the fare by a dollar or two (or similar amount in foreign currency), depending on the distance or assistance provided. For example, a fare of $8.20 would be rounded up to $9, or to $10 for assistance with luggage or packages. When paying, many passengers add 10 percent of the fare for a tip, especially if the driver has gone a long distance or loaded and unloaded luggage.
A taxi driver earns a tip by offering excellent service. This would include handling packages or luggage, opening doors, picking up for a return trip and other such considerations. Taxi drivers who provide pleasant service, a clean cab and safe driving deserve a tip.
It is helpful to carry small denominations of money when taking taxis. Some drivers may not be able to make change, or don't want to. Small bills make it is easy to add a tip and pay the driver. Taxi fares can either be paid at a straight meter rate or at a negotiated flat amount from pickup to destination. A tip can be added to either type of fare.
When traveling in a foreign country, taxi cabs can present both a convenience and a challenge. In addition to using common sense and following basic safety guidelines, terms of payment should be understood before hiring a taxi cab. Ask locals or a hotel concierge the general rates for your destination. A concierge can advise on local tipping customs, as can guidebooks and local visitor magazines.
