Why is taxi fare (in the UK at least) the same price for 1 as for 4 people

Surcharges for Extra Passengers

Here are two counterexamples. In both Italy and France, if I recall correctly, taxis charge extra when the number of passengers require one to seat on the front seat next to the driver. Furthermore, a surcharge can be applied when the customer requires a car with more than 5 seats (including the driver). Note that the concept of a 5-backseats taxi is somewhat unique to the UK, hence in the aforementioned countries when 4 people take a cab one of them usually sits at the front.

Italian Taxis

Indeed, surcharging by person seems to be a relatively common practice across Italian taxi companies. Take for example the pricing list for the Taxis in Padova, Italy:

Supplemento oltre la terza persona trasportata € 1,05/persona

Stating that there is a 1.05€/person surcharge for any number of passangers greater than 3. This applies to both 5-person cars as well as cars with more seats.

The taxi consortia in both Naples and Turin on the other hand, apply a surcharge for any number of passengers greater than 4. The Neapolitan taxi service website says:

Per ogni passeggero oltre il 4° (se l’utente chiede una vettura con un numero di posti superiore a cinque) 1,00€

I.e. when the customer requests a car with more than 5 seats (including the driver), a surcharge of 1.00€ will be applied to each passenger. The Turin taxi service website says:

Supplemento PASSEGGERO oltre il quarto

  • € 3,50 per quinto passeggero
  • € 1,00 per sesto passeggero e oltre

I.e. when the customer requests a car with more than 5 seats (including the driver), a surcharge of 3.50€ will be applied to the fifth passengers, and 1.00€ for each additional passenger.

French Taxis

Similar surcharges apply in France too. Parisian taxis charge 3.00€ for the fourth and any other additional passenger:

Supplement per person over and above 3 passengers € 3.00

The same applies in Nice, where the surcharge is 1.58€:

  • Majoration 4ème personne : 1.58 €.

Turns out these values are usually limited by municipal (administrative) regulations.