The Mayor of Wellington says the council will lobby the Government to cap the number of taxis in the capital.
Celia Wade-Brown says taxis are creating traffic problems and making it hard for cab drivers to earn a decent living.
Ms Wade-Brown says before the taxi industry was deregulated in 1989 there were between 300 and 400 taxis operating in Wellington.
Twenty years later, she says the region's population has grown by about 10%, but the number of taxis on the roads has trebled.
The mayor says Wellington's cab ranks have room for about 150 taxis and they are now clogging bus stops and public parking spaces.
The Taxi Federation agrees that there is an excess of taxis in the capital and is calling for an inquiry.
Executive director Tim Reddish says New Zealand has more taxis per capita than any country in the world and the Government should cap their numbers.
Mr Reddish says consecutive Governments have relied on competition within the industry to restrict taxi numbers, but he says such free market thinking has failed.
The high number of taxis is causing traffic issues and making it difficult for drivers to secure a liveable income, he says.
The Government says it will not consider capping taxi numbers.