Shares in taxi payments company Cabcharge have tanked after the Victorian government said it would order it to slash fees on card payments by half.

The share price fall came after Victorian Premier Denis Napthine said the government would accept most of the recommendations of an inquiry into the taxi industry by Professor Allan Fels.

Cabcharge’s shares had slumped by 64 cents, or 13.06 per cent, to $4.26 by 1352 AEST after earlier being down 19 per cent.

The government supports ordering Cabcharge to lower the eftpos fee from 10 per cent to five per cent of the fare.

Investors have interpreted that as meaning a sharp hit to Cabcharge’s earnings, which analysts warned about late last year when the inquiry was released.

Cabcharge released a statement saying it would study the government’s document, which involves an overhaul of the industry and its fares.