When I was working as full time instructor a student came in after an hour of circuits looking very worried. The Hobbs had failed internally and the only wheel turning was the "tens" numbers. His circuit session had increased the Hobbs by 90 hours
I could not resist and told the dispatcher to bill him for 90 hours saying he had to pay what the Hobbs recorded.
The poor guy just about broke down in tears so I hastily let him off hook
This issue is a classic example of what is versus what should be.
What should be: That the hire rate reflects wheels up to wheels down and the pilot is trusted to accurately record and report flight time and airtime by using his/her watch.
What is: Taxi time costs the school next to nothing and allows them to post a lower hourly rate over what a rate covering only airtime would be. Most pilots shop by numbers and so the higher but more accurate rate of charging airtime only, would be business suicide. Also a significant number of renters would abuse an honour system therefore again hurting the financial viability of the school
Sad to say the Hobbs engine start to stop system of charging time is going to remain the industry standard.