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"Road tax" jibes to be consigned to past? Think tank recommends scrapping Vehicle Excise DutyCar wheel at speed copyright Simon MacMichael.jpg

"Road tax" jibes to be consigned to past? Think tank recommends scrapping Vehicle Excise Duty

CentreForum proposes replacing existing annual taxation regime with one-off "first registration" charge...
by Simon_MacMichael
Thu, Oct 04, 2012 09:47
35

Could “pay your road tax!” jibes directed at cyclists become a thing of the past? A think tank is proposing that instead of motorists paying annual Vehicle Excise Duty (VED), a large, one-off "first registration" tax should instead be imposed on the purchase of large-engined vehicles such as sports cars and 4x4s.

Under the proposals devised by Tim Leunig, chief economist at he independent liberal think tank Centre Forum, a supercar such as the Aston Martin one-77 could attract a “first registration” tax of £23,050 based on emissions.

The mooted tax would see purchasers of new cars charged £50 for each gram of carbon dioxide the vehicle produces over a set threshold, suggested as being 94g/km. Purchasers of some less polluting vehicles could benefit from a government subsidy of up to £750 under the proposals, which have the backing of the Liberal Democrats.

In his report, Cutting emissions and making cars cheaper to run: a new approach to vehicle excise duty, Dr Leunig provides examples of how the proposals might operate on various models of Ford Fiesta.

The cost of a 1.25 litre model would go up from £9,084 to £10,734, but for the 1.6 litre diesel model, the price would fall from £11,845 to £11,495.

"More efficient cars save motorists money and reduce global warming. What's not to like?" said Dr Leunig, who wrote the report prior to his recent appointment as policy adviser to the Secretary of State for Education, Michael Gove.

Ed Davey, Secretary of State for Energy and Climate Change, commented: “I welcome this report. It is exactly the sort of innovative thinking we have come to expect from CentreForum.”

Vehicle Excise Duty – often erroneously referred to as “road tax,” something that hasn’t existed since the 1930s – raises nearly £6 billion annually, but the amount raised is forecast to fall in the years ahead as motorists choose more fuel-efficient models, leading civil servants to consider alternative ways of raising motoring-related taxes.

Vehicle Excise Duty
road tax
Simon MacMichael

Simon joined road.cc as news editor in 2009 and is now the site’s community editor, acting as a link between the team producing the content and our readers. A law and languages graduate, published translator and former retail analyst, he has reported on issues as diverse as cycling-related court cases, anti-doping investigations, the latest developments in the bike industry and the sport’s biggest races. Now back in London full-time after 15 years living in Oxford and Cambridge, he loves cycling along the Thames but misses having his former riding buddy, Elodie the miniature schnauzer, in the basket in front of him.

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35 comments

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drheaton replied to GZA | 11 years ago
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GZA wrote:

You do not own a car (fair play by the way), well there you go, you do not have a balanced viewpoint. I understand what you are saying but you are missing the point - the vast majority of motorists will never accept us until we do contribute, and that will be a price worth paying to achieve IMO.

Yes, but we do contribute, that's the point! Statistically cyclists are more affluent than non-cyclists so per person cyclists are paying more towards road infrastructure than the average population.

I pay income and council tax which pays for the roads and other systems. I already pay, I don't see why I need to pay twice just for motorists to find some other reason to hate me.

I also have a car and pay VED, I have no issue paying that because when I drive it I pollute. I don't pollute when I cycle so why should I pay more?

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OldRidgeback replied to drheaton | 11 years ago
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drheaton wrote:
GZA wrote:

You do not own a car (fair play by the way), well there you go, you do not have a balanced viewpoint. I understand what you are saying but you are missing the point - the vast majority of motorists will never accept us until we do contribute, and that will be a price worth paying to achieve IMO.

Yes, but we do contribute, that's the point! Statistically cyclists are more affluent than non-cyclists so per person cyclists are paying more towards road infrastructure than the average population.

I pay income and council tax which pays for the roads and other systems. I already pay, I don't see why I need to pay twice just for motorists to find some other reason to hate me.

I also have a car and pay VED, I have no issue paying that because when I drive it I pollute. I don't pollute when I cycle so why should I pay more?

Read my posts please. Increasing fuel taxation is a very short term approach to generating funding for road construction. Road user charging is inevitable for motor vehicle owners. Those in the road sector are also aware that cycling reduces congestion and wear an tear on the network is therefore to be encouraged, so that cyclists will not be charged. Those who call for cyclists to pay to use the roads do not understand all the factors with regard to road use and funding.

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giff77 replied to GZA | 11 years ago
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GZA wrote:

You do not own a car (fair play by the way), well there you go, you do not have a balanced viewpoint. I understand what you are saying but you are missing the point - the vast majority of motorists will never accept us until we do contribute, and that will be a price worth paying to achieve IMO.

Sorry, but I do have a balanced viewpoint. I have held a licence for over 25 years. I have also owned numerous cars and driven all kinds of vehicles. In one of my previous jobs one of my responsibilities was to ensure that the fleet of artics and flatbeds had the correct duty paid.

I say again, all the taxes and duty I pay contribute to the upkeep of the road infrastructure. The VED is a tax on your vehicle's emmissions it goes into the pot and IS NOT ringfenced for road maintenance. Car ownership has become a right in the UK rather than a privilage or a need and with it the misperception that the motorist 'owns' the road. We cannot reinforce this misperception that VED is the motorist paying their way. It is the consequence of owning a piece of polluting machinery. We can also not afford to go down the way of 'road pricing'

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jimmyd | 11 years ago
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VED should be scrapped as we pay tax on fuel - which itself is a pay as you drive tax. I think an insurance disk should be displayed instead.

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giff77 | 11 years ago
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In the Republic of Ireland you have to display an insurance disc. Meanwhile in N Ireland as well as the VED disc you have to display a MOT disc. I'm sure there are other countries around the world that you are require to display certain 'discs'

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