A price war on taxi fares is expected under sweeping changes proposed in a government green paper that folds the established West Australian taxi industry and ride-sharing apps into a single licensing system.

The ABC understands the much-anticipated green paper, which is yet to go to Cabinet for approval, proposes more competition and a much less prescriptive and more flexible licensing environment.

There would be one licensing regime applied to all drivers of taxis, Uber vehicles and other new technology-based services arriving in the WA market.

The green paper also proposes that, with the exception of taxi rank and "hail", the current metered system used by taxis would be replaced with a model where customers are quoted a pre-agreed fare at the time of booking and payment is secured before travel.

It also proposes the Government would move away from regulating fares and instead allow operators to set and administer fares themselves.

It is anticipated this would do away with common problems of taxi drivers overcharging, fights between drivers and passengers over fares, fare runners and patron uncertainty about costs.

The green paper comes after hundreds of taxi drivers protested at Parliament in April over State Government inaction over the popular discount ride-sharing service Uber.

Uber has created uneven playing field: taxi drivers

Taxi drivers in WA currently operate in a heavily regulated environment and have long complained about an uneven playing field because of new services such as Uber, which remain unregulated.

Key points: More flexible and less prescriptive licensing environment

More flexible and less prescriptive licensing environment More competition and transition towards level playing field

More competition and transition towards level playing field One licensing regime applied to all drivers and vehicles - minimum standards enforced to ensure safety

One licensing regime applied to all drivers and vehicles - minimum standards enforced to ensure safety Move away from metered system to pre-agreed fares and payment before travel

Move away from metered system to pre-agreed fares and payment before travel Potential scrapping or reduction of annual government fees for plate owners and those who lease government plates

Potential scrapping or reduction of annual government fees for plate owners and those who lease government plates No compensation for existing plate owners

No compensation for existing plate owners Department of Transport focus on compliance; be given greater powers

Department of Transport focus on compliance; be given greater powers Taxi drivers not forced to affiliate with a particular dispatch service, such as Swan Taxis

Taxi drivers not forced to affiliate with a particular dispatch service, such as Swan Taxis Regulate industry under a single act

Regulate industry under a single act Industry take on greater responsibility for training drivers

The Green Paper is likely to provoke a backlash from taxi plate owners who are unlikely to be offered compensation for their expensive plates and from dispatch companies such as Swan Taxis, which currently have a stranglehold on the regulated parts of the market.

Under the proposed changes, a single piece of legislation would govern the licensing of all on-demand vehicles in a bid to create a more even playing field.

The licensing regime would set reduced minimum standards for drivers of all services, including a national police certificate, but individual businesses would be responsible for setting their own additional training standards.

It is hoped that this approach would create an environment where service and safety improves as customers vote with their feet.

The Department of Transport would remain the industry regulator, but would get beefed up powers and more effective penalty provisions.

Its role would be re-focused to only set minimum standards and monitor compliance and it would no longer have a training or testing role.

While licence conditions would be less prescriptive, the department would continue to set minimum vehicle safety standards, including those relating to the age of a vehicle.

All licensed vehicles would be required to be easily identifiable either through a licence plate or some other means to ensure public confidence in the industry.

The department would have a mechanism to remove "undesirable" drivers from the industry.

The more relaxed regulatory environment would include fewer restrictions on the types of services that could be provided and the types of vehicles that could be used.

It is envisaged operators would be able to provide different types of services at different price points to increase the choice for customers.

Green paper proposes waiving taxi plate fees

There are more than 2,500 privately owned and government-leased taxi plates in WA.

The licence fee for a government-leased taxi plate is currently about $13,000 a year.

It is understood changes to this fee are contemplated because of the disadvantage it places on metropolitan taxi drivers. Taxi plate owners also remain subject to ongoing fees.

Taxi drivers rallied outside WA Parliament in April, demanding the Government take action against ride-sharing service Uber. ( ABC News: Jon Sambell )

The ABC understands the paper proposes waiving these fees and charges either permanently or for a period of up to 20 years as a way of helping plate owners transition to the new regime.

It is understood the paper makes no mention of compensation to taxi plate holders as the Government moves towards a deregulated system.

Premier Colin Barnett has previously ruled out compensation.

The Government also hopes to create more competition in the industry by removing a requirement that taxi drivers be affiliated with a particular dispatch service, such as Swan Taxis.

It is hoped that this would encourage more dispatchers to enter the market and improve competition.

The green paper is designed to pave a way forward to reform the industry and prompt debate.

It is expected to go to Cabinet next week for approval, before it is publicly released.

A spokeswoman for Transport Minister Dean Nalder said he could not comment before the paper went to Cabinet.

It will then go out for public consultation for 12 weeks before a final report is prepared to go back to Cabinet.