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news
George OsborneRoad tax is back – Chancellor announces Vehicle Excise Duty reforms that will see money raised reserved for road improvements
It seems there really is a road tax again. In his seventh Budget as chancellor – the first Conservative Budget in 19 years – George Osborne has announced reforms to Vehicle Excise Duty which will see money raised earmarked for road network improvements.
Osborne said:
“I will return this tax to the use for which it was originally intended. I am creating a new roads fund from the end of this decade – every single penny raised from VED in England will go into that fund to pay for that sustained investment our roads so badly need.”
Road tax was abolished in 1937 and replaced by Vehicle Excise Duty, the proceeds of which have up until now gone into the general Treasury fund. References to "road tax" are of course often made by drivers as a means of suggesting they have more right to the roads than cyclists (or indeed than pedestrians or horse riders).
A new system of Vehicle Excise Duty will be brought in for new cars from 2017 and while no extra revenue will be raised, the Chancellor claims it will be "more secure". It will be emissions-based in the first year, after which there will be three levels – zero emission, standard and premium. Around 95 per cent of vehicles are expected to fall into the standard category, which will cost £140 a year.
Under the new system, cars emitting 0g/km CO2 will pay nothing – the same as a cyclist. Or at least it would be the same as a cyclist if a 2010 study hadn’t found that the people who cycle the most are likely to own at least two cars. Cars with a list price above £40,000 will attract a supplement of £310 per year for the first five years in which the standard rate is paid
The Chancellor also froze fuel duty for the rest of the year.
CTC is concerned that today’s announcements could effectively create a 'road fund' and lead to calls for a similar tax on cyclists to pay for the Cycling and Walking Investment Strategy. The original 'Road Fund' was abolished in 1937 thanks to opposition from Chancellor Winston Churchill who argued that spending motor taxes only on roads would lead to motorists assuming a 'moral ownership' of them.
Roger Geffen MBE, Policy and Campaigns Director at CTC, the national cycling charity, said:
"George Osborne has today reversed Winston Churchill's most sensible transport decision. Given this, it is therefore a relief that Parliament and the Prime Minister are already committed to cycling investment, and to 'cycle-proof' all road and traffic schemes to ensure cycling is properly designed into them from the outset.
"However, CTC still believes this is a doubly regressive policy, raising more tax from cleaner cars to build more roads, when councils are struggling to maintain the ones we’ve got. And we still want to know how much the Government will allocate to the promised Cycling and Walking Investment Strategy, and when they will confirm this.”
Jason Torrance, policy director at Sustrans, commented:
"Vehicle Excise Duty is a tax on pollution: those cars which create the most greenhouse gases are taxed most heavily. Siphoning that revenue into a new Roads Fund will inevitably lead to further pollution and undermines its original purpose.
"Over this parliament alone £15bn will be spent on new roads. Research proves that creating more road capacity will lead to increased demand, and therefore more miles driven.
“The Chancellor has kept the tax on fuel frozen at 57.95p a litre for more than four years, which is a populist policy but one which fails the public in that it serves only to lock them into having to use their cars.
“With physical inactivity, pollution and congestion increasing across the UK, investing in cycling and walking is an economic silver bullet and government must act across all departments to secure significant investment. Government must create a Cycling and Walking Investment Strategy that guarantees long-term funding for active travel.”
Alex has written for more cricket publications than the rest of the road.cc team combined. Despite the apparent evidence of this picture, he doesn't especially like cake.
Latest Comments
- Legin 7 min 5 sec ago
The earlier version of this camera was branded by Chilli-tech and I purchased one of those. Delighted with it, a cracking camera with a good light....
- brooksby 8 min 7 sec ago
Don't you be comin' on 'ere with yer "common sense and rationality"
- lesterama 1 hour 2 min ago
What a bunch of ases
- GMBasix 1 hour 17 min ago
Well, naturally: I thought that was a given
- quiff 1 hour 55 min ago
It was only your comment in the carousel that first brought me here, and yet I still managed to read most of the page before remembering this isn't...
- quiff 3 hours 24 min ago
That comparison might work in answer to the ill-considered "you can't bring your bike in, it's got dirty tyres" but not sure it's apposite here as...
- gazza_d 4 hours 2 min ago
Acts like this should be regarded as domestic terrorism, because that's what it is.
- eburtthebike 5 hours 27 min ago
The Daily Mail, Telegraph and GB News.........
- Benthic 5 hours 40 min ago
Not AB specifically, but that sort of thing. Focus Pocus is the most entertaining.
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80 comments
been thinking about this, VED is being used to fund strategic roads, that was what was clearly stated. SO drivers have no right to use any roads that aren't motorways or other major routes. They aren't paying for them so have no right to use them!!!!!
Just using the road tax logic.....
To avoid confrontation just disguise your bike as a huge, slow moving penis then just tell people you are driving a Toyota Prius.....most people are unable to tell the difference.
Complete faffing and a waste of time. Just spend the money where it needs to be spent, i.e. do your job and budget, it is what the res of us do. Moron.
What next? Speeding ticket fines revenue to be ring fenced to pay for new road signs? Parking fines will directly contribute the trident missile programme?
"...while no extra revenue will be raised..."
Yes, of course, because politicians do things for the good of it.
I don't understand the relation between the pollution and the need to maintain roads. If there are only zero emission vehicles, you don't need to maintain the roads?
Plus, if you think of electric cars as zero emission vehicles you're completely wrong; how much nuclear power plants do you need to run them? Heck of a lot. So much wrong that as of now nobody knows what to do with nuclear waste ... It's just another genre of pollution!
Completely clueless politicians. err, they are just very well paid corporate representatives .
The transfer of energy to the vehicle from the power plant is another inefficiency. Unless the power generated is from nuclear of renewable then electric vehicles are a poor idea. Their only benefit is to reduce air pollution in cities.
And another about nuclear, if we were to derive all of our electricity from nuclear (and forget about electric cars) there would only be a 20 year supply of uranium. Nuclear is expensive, reprocessing nuclear fuel is extremely expensive. Getting uranium from seawater is both extremely expensive and also very resource intensive (oil!!!).
Nuclear is a dead end - a very expensive dead end with a horribly long waste legacy for very little gain.
The world can be powered 100% renewables when you stop trying to limit renewables to just wind + solar.
▶ Powering the World With Wind, Water, and Sunlight: Mark Jacobson at TEDxPaloAltoHighSchool - YouTube
▶ The storage necessity myth: how to choreograph high-renewables electricity systems - YouTube
The "emissions" thing is just a red herring everyone seems to fall for. VERA, the Vehicle Excise and Registration Act 1994 states in its introduction
"A duty of excise (“vehicle excise duty”) shall be charged in respect of every mechanically propelled vehicle..."
http://www.legislation.gov.uk/ukpga/1994/22/section/1
It's not emissions that governs whether a road user must pay VED or not, it is mechanical propulsion. It makes a decent kind of sense, the roads having originally been constructed (and still being legally also) for foot and hoof traffic. Mechanical propulsion gives road users a means of benefiting unfairly from a resource provided at public expense. Any move to make the roads pay-to-use makes them private, not public. Winston was right.
To be honest, I don't mind these challenges - it drives innovation in lower forms of green technology. As far as I understand, there still will be a low (cost free) tax band for the cleanest forms of driver technology. The VED should be based on emissions and damage to the road caused. From my experience vehicles such as HGV, Buses, Vans and Cars all cause damage to the road whereas a bicycle does not.
As I've said, for a cyclist who cycles 500 miles a month and works in research in this area - hopefully it will drive for more innovation as the clean credentials are a valuable USP.
So, who pays for the pavements which are er, next to the road?
"it is therefore a relief that Parliament and the Prime Minister are already committed to cycling investment, and to 'cycle-proof' all road and traffic schemes to ensure cycling is properly designed into them from the outset."
FFS the CTC have believed this lie? I thought they were more savvy.
the red book afterwards confirms it will raise extra taxes along with for example insurance tax hikes ..
hearing the AA moan about that eh ?
Could you be any more utterly ignorant, good grief.
Have you never heard of renewable energy? Vehicle Emissions Duty is to encourage people to pollute less, electric cars pollute less. The more renewable energy we install, the less electric cars pollute.
I can see that a new nuclear power station is probably the most efficient and reliable form of power generation at present.
However, still not sure what we do with nuclear waste: World civilisation has been around for about 6000 years tops (including the time when we built mud cities and cut people's hearts out to make the sun rise); we've had nuclear power for, say, 70 years, and we have nuclear waste with a half life the far side of 10,000 years...
(Basically, we need someone to invent a working Mr Fusion unit like on Back to the Future 2. Household waste, garden waste - pop it in Mr Fusion.)
MInd you - we'd still have to maintain the roads.
Are you saying coal power stations over nuclear? You're arguing against nuclear with renewables (which is obvious to people that care). My point and one i've heard from a lot of clever people in sustainability, is that at some point you have to be real and get rid of the coal fired power stations. At the moment, that means nuclear. As much as i'd love it not to, renewables aren't going to embraced universally.
Bury it in concrete or underwater or fire it into the sun. The waste issue shouldn't put us off the best source of energy that we have.
Roads? Where we're going, we don't need roads.
I think it's pretty clear what I'm saying, we don't need coal or nuclear.
In an ideal world, I completely agree. However, consider the opposition a wind turbine in the middle of nowhere gets... we don't live in an ideal world. That was all I was trying to say.
I'd much rather we were all renewable. Shall we all move to Iceland or Chili?
You're right about zero emissions vehicles being fairly polluting, but not down to the nuclear power plants. We're still very dependant on burning fossil fuels for our electricity. Like it or not, nuclear waste is a relatively small problem compared to our co2 issues. Nuclear is the only realistic way forwards at the moment. Obviously, i'd prefer wind, tidal and solar, but we can't build enough to sustain us (even if we could get past all the anti renewable idiots).
New Nuclear plants are much more efficient, producing less waste and even green peace is now backing them!
Nuclear is horribly expensive and with half a century to decide, still no-one knows what to do with the waste. And accidents, the nuclear industry have proven many times that they are incapable of getting nuclear power without making a huge mess of it.
And Greenpeace do not support nuclear, get your facts straight.
Nuclear Power and Nuclear Energy Dangers | Greenpeace
Nuclear power | Greenpeace UK
So that explains the near misses I had on the way to work today. Thanks Ozzy.
I can't see this making much of a difference as to how that certain type of driver views a 'non road tax paying' cyclist. They already believe cyclists have no rights to be on the road, informing them 'road tax' was abolishing in 1937 won't make them change their minds neither will the zero emission argument.
Surely he has to include a line on the table which reads
Cyclists £0
Not really. Without looking at the legislation I'd guess VED only applies to "motorised vehicles" or somesuch.
Unless you want him to enumerate every possible roadgoing vehicle... Unicycles, recumbents, tricycles, horse, horse and cart, pony and trap...
I would invite irate motorists to inspect my zero emission badge.
Seriously, I doubt a new fund will undo the years of local neglect to our roads, most of it will go on bypasses and motorway upgrades. Your local innercity through route will still be down to the council and dug up to buggery by Virgin Gas and Welsh Amazon Water.
I was cycling down a local road recently when a HGV driver leans out of his window " get of the road you fucking twat".
At least he has the bollocks to say what he thinks, unlike all the cockwombles who just want to frack the last bit of value from oil whilst talking shite about growth.
THERE IS NO ROAD TAX. THIS IS STILL A TAX ON CARS, NOT ROAD USAGE
There will be another election before the end of the decade, and even IF the torys are still in government, still plenty of time to gorget this if tax revenue is needed elsewhere.
As other have pointed out, its a totally empty gesture then the tax collected from VED is less than the total road spend.
Its Just political spin to appeal to the Mr toad crowd
Doesn't matter. If it goes ahead as described then it will be a hypothecated tax that "pays for roads" which only motor vehicles are liable to pay.
That's clearly divisive and justifies the "you don't pay for the roads" criticism.
It will be used to justify reducing spending on cycling infra, or introducing a bicycle tax, or both.
Maybe but only in the minds of ignorant people, and you won't change them anyway.
80% of cyclists own a car. Mine is not zero-rated so I will be paying the tax DESPITE using my bicycle for most my journeys. So any ignorant jerk who wants to argue about it can pay my 'Road Tax' for me in October.
I have been paying VED since 1989. Almost every year until 2001 I paid twice because I also rode a motorcycle. I have never considered that this bought me any kind of privilege.
"I don't have to pay this new-fangled road tax, because the roads are mine and my pedestrian friend's by right."
Suits me.
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