The Uber service will soon be made legal in New South Wales, according to a new report with the Daily Telegraph.

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Uber has long described its mobile app-based service as a platform to connect commuters with independent drivers - referred to as "partners" - but current laws in most regions of Australia make it illegal to operate as an UberX driver.

The ACT has so far been the only jurisdiction to legalise the Uber service, with new laws announced in September joined by new safety and insurance regulations for drivers, and sweeping changes to the territory’s taxi licensing scheme.

Now, a new report with the Daily Telegraph suggests that NSW will follow the ACT into making Uber legal, with its own set of conditions.

The report claims that Uber drivers will need to pay for a taxi-like licence, while tougher rules around driver approval - including more extensive criminal record checks and vehicle safety checks - will also be introduced.

It is also expected that the government will significantly reduce the cost of obtaining a taxi licence - which can run upwards of $300,000 - while offering existing taxi owners compensation for the loss of exclusive control of the market.

According to the Daily Telegraph, the NSW government has yet to determine the extent of that compensation, or how the funds will be raised.

Taxi drivers will also retain exclusive access to waiting areas and the right to accept kerbside hails.

The changes, which will reportedly be introduced next month, are the result of the NSW government’s Point to Point Taskforce, established in July.

Last month, the taskforce announced it had received submissions from more than 5600 individuals and groups from across the community, including taxi drivers and services, Uber drivers and the general public.

“It’s clear that the regulatory framework needs updating to reflect changes in customer demands and emerging technologies and community feedback will play a key role in helping the taskforce shape its recommendations,” taskforce head Professor Gary Sturgess said in October.

The report has not yet been released.