Shares in Cabcharge have plunged more than 15 per cent after the Victorian Government announced an overhaul of the state's taxi industry.

The plan includes setting the service fee for taxi fares paid by credit card at 5 per cent - half the current fee set by Cabcharge.The company's 2012 annual report shows that it received $89.6 million in fee income last financial year from around $1.05 billion in cab fares paid using either its own Cabcharge accounts or using credit cards through one of the company's in-taxi terminals.In a statement, Cabcharge says it will study the report and issue a "considered response" at a later date.Cabcharge shares plunged 15 per cent to close the day's trade at $4.15.The Victorian inquiry also proposed a range of other measures to improve taxi service, lift competition and lower costs, including the appointment of former Australian Competition and Consumer Commission (ACCC) chairman Graeme Samuel as the head of a new Taxi Commission.

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