The first of the assistance payments from the taxi hardship fund have begun to arrive.

But there appears to be a sting in the tail for drivers, who many had argued were already being shortchanged by the government.

They’re being taxed on the payments.

Hire car driver Peter told Tom Elliott on Monday he was going to lose $5000 of the $25,000 cheque he received, with Neil Mitchell hearing similar cases from other drivers on Tuesday.

It was enough to prompt former Premier Jeff Kennett to call in.

“It is grossly unfair,” he said.

Rod Barton from the Victorian Hire Car Association said the licences were assets, not income, and therefore should not be taxed.

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