Uber Australia chief David Rohrsheim has described a compensation deal for taxi licence owners as "a bit strange" after winning approval to operate legally in New South Wales.

Mr Rohrsheim was cautious about a proposed one dollar levy that will be imposed on Uber, traditional taxis and hire cars to help fund the landmark compensation scheme.

"The idea of a levy though does sound a bit surprising. People are looking for affordable ways to get from A to B and we do find it a bit strange a government would willingly raise those fares," Mr Rohrsheim told AM.

"I find it strange that the [NSW] Government would get in the middle of that and willingly raise fares which makes this transportation less attractive."

Mr Rohrsheim was also dismissive of plans announced yesterday to compensate current owners of taxi licence in NSW $20,000 per plate, up to two plates, to assist with the deep devaluation of their investments.

"That's something that deserves more careful examination. These taxi plates have been, in some cases, granted free of charge and some people have held them for many, many decades and have enjoyed a very, very healthy return, so I think they've had a very, very good run," he argued.

"This isn't the last industry that is going to face some digital disruption and (the consumer) response will shape expectations for future disruption and future industries that undergo change."

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 4 minutes 17 seconds 4 m 17 s Uber boss cautious on compensation for taxi owners in disrupted industry ( Peter Ryan ) Download 7.9 MB

New South Wales follows the ACT in allowing Uber, and the UberX service, to operate legally.

David Rohrsheim says talks are underway in the remaining states and territories to become legitimate.

"There's a review underway in almost every state across Australia and we've got no reason to believe they'll reach a different conclusion," he said.

"New South Wales deserves credit for finishing their review first and showing some leadership."

Uber's status around Australia ACT - interim ridesharing regulations introduced

ACT - interim ridesharing regulations introduced NSW - interim ridesharing regulations introduced

NSW - interim ridesharing regulations introduced VIC - awaiting Government update on recommendations from a Ministerial Forum that the Minister received in July

VIC - awaiting Government update on recommendations from a Ministerial Forum that the Minister received in July QLD - in the process of a ten-month review of the point-to-point transport sector, due in August 2016

QLD - in the process of a ten-month review of the point-to-point transport sector, due in August 2016 WA - awaiting a Government response to recommendations provided in the point-to-point transport Green Paper

WA - awaiting a Government response to recommendations provided in the point-to-point transport Green Paper SA - no review that includes specific consideration for ridesharing

SA - no review that includes specific consideration for ridesharing TAS - looking at amending existing legislation to accommodate ridesharing in the first quarter of 2016

Follow Peter Ryan on Twitter @peter_f_ryan and on his Main Street blog.