I don't think taxis will be pulled, It just means paying for a yearly fee for a car that might only be on the road for 6 months, it's basically like that now, I think it ought to be a six month fee.
As regards taxi quantity numbers, there is now a limit on the amount of taxi cabs allowed on the street. This limit was brought in way to long after the complaints about the numbers first started. The council were raking in the coins for every cab they put on the street. Their revenue is now fixed to the limit of taxis
Now take a private hire firm for example. Say the boss has 10 people working for him, ten more people approach him with their cars and want to work for him, there's no limit on private hire car numbers. He might charge drivers £50 a week for use of the radio equipment etc. He'll be another £500 a week better off now. His other 10 workers have just had 50% of their work shared with the 10 new drivers. Any wonder they complain !!
The new 3 year badge might make people think twice before trying the trade. Regardless of where they come from.