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news
Cars on the A4 at Brentford (copyright Simon MacMichael).JPGRoad pricing “inevitable,” MPs are told as switch to electric vehicles hits tax revenues
Road pricing is “inevitable,” a House of Commons committee has been told, with tax revenues from motorists due to plummet as a result of the switch to electric vehicles.
The call to start charging motorists to use roads nationwide was made yesterday at an oral evidence session on the issue held by the House of Commons Transport Select Committee by Toby Poston, director of corporate affairs at the British Vehicle Rental and Leasing Association (BVRLA).
He urged a trial system to be developed to help meet an estimated £31 billion reduction in revenue from Vehicle Excise Duty (VED) and fuel duty as private motorists and fleet operators increasingly switch to zero emission vehicles.
“It is imperative that road pricing is considered and trialled now to ensure a smooth transition into a new system,” he said.
“Drivers and fleet operators need clarity on future taxation as they make the transition to zero-emission road transport.”
While some road pricing does exist – notably, the congestion charging zones in Durham and London, or charges to use infrastructure such as the Dartford Crossing and the M6 toll road – successive administrations have resisted introducing a nationwide road pricing system.
Such measures have however been considered in the past, and were recommended as long ago as 1964 by the Smeed Report, commissioned by then Conservative government.
In 2005, the then Labour government announced plans for a national scheme under which vehicles, equipped with satellite trackers, would incur charges ranging from 2p per mile on the least busy roads to £1.34 on the most congested roads at peak periods.
The proposals were dropped after an online petition attracted 1.8 million signatures, and while around a third of households in the UK do not have access to a motor vehicle, any move towards road pricing is likely to be unpopular among many voters who do drive.
Wider public opinion may be changing, however. A survey conducted by the Social Market Foundation shortly before the recent fuel crisis found that 38 per cent of respondents were in favour of introducing road pricing, with 26 per cent opposed.
Research director, Scott Corfe, said: “For too long politicians have thought of reforming motoring taxes as grasping the nettle, fearful that a backlash from drivers will hit them at the polls.
“In reality, the public want to see a better, fairer system of how the UK taxes drivers. Our research shows that road pricing, often perceived as politically poisonous, is seen as a preferential option compared to our existing tax regime.”
The current government, which says it is committed to promoting active travel and trying to reduce dependency on cars, particularly for shorter journeys, has already acknowledged that ways will have to be found to make up for the predicted lost revenue, an issue mentioned in HM Treasury’s Net Zero Review Interim Report, published last December.
In his appearance before the Transport Select Committee yesterday, Poston added: “Any new road pricing scheme must be easy to pay and have the simple objective of providing a revenue-neutral replacement for fuel duty and VED.
“It should be based on a simple ‘distance-driven’ model that considers vehicle weight, emissions and use case, with discounts given to shared mobility solutions – such as car clubs, rental cars, buses and taxis – to incentivise more sustainable travel choices.”
Yesterday’s session formed the second part of the committee's inquiry on Zero Emission Vehicles and Road Pricing.
From a cyclist’s perspective, one aspect of road pricing, should it be introduced across the country, is inescapable; it would give motorists who currently rail against people on bikes “not paying road tax” – even though cyclists are more likely than average to also own a car, and road tax itself was phased out in the 1930s – a figurative stick with which to beat us.
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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Car share is essentially the solution. Once a car is driverless the design can be radically different from current cars, private pods with separate doors could easily be designed reducing barriers to car sharing.
If most people are booking via an uber style app then the journeys could be shared automatically without any input needed from the commuter themselves.
Such a vehicle would have huge advantages over buses and would be far more appealing to most people.
Once driverless cars are established I think car ownership will naturally decline, why would you pay thousands of pounds a year for a car when a substitute service costs a fraction of that?
That mini network looks really good, Cardiff is not quite at that level yet but it is getting there!
everyone meeting virtually.. what a horrible dystopian future you envisage..
I'm afraid it is already here. Anyone office based will have suffered death by Teams.
Lacking the imagination to furnish you with a fever dream beyond your imagining I can only suggest an existing nightmare vision of what could be. For your delictation: the traffic-sick suburbs of america, the air pollution of Jakarta, the fuel poverty of parts of africa, the awfulness of 4chan. And of course one specially for our Nigel.
As for virtual meetings - it sounds like some people in the UK - England especially - are so horrified by the prospects of lack of normal social engagement they're willing to risk their own health and that of others.
Driverless cars common on public roads by 2030? Care to make a bet?
Seeing as they're already common in two US cities and Munich is launching a service next year yes I will take your bet.
They will be common in cities/large towns/motorways by 2030.
Well I think that the solution is quite simple and has been suggested by a number of people and media commentators over the years. It would be a popular choice and vote winning decision that would solve several issues that are often reported on this website.
That is to remove all tax or duty from car purchase and ownership. Remove all tax from petrol and diesel fuel. More tax relief for hard working lorry operators and hard working and loyal taxi drivers (especially in London) and make all and only cyclists pay road tax.
As a cyclist I think that this is the only fair solution.
I'll get my straight jacket.
So instead of not paying road tax (VED) for the smoke I don't generate I'll now have to not pay road tax for the wear and tear on the tarmac I don't cause?
A pet peeve: "zero emission vehicles" are actually "emit somewhere else vehicles". This can certainly be a health-improver but doesn't necessarily sort our environmental problems. Yes some of that electricity may come from wind turbines, hydro and
woodchips and cow chipsbiomass but not all yet. And by the time the amps get to us we can't tell where they're from. (Nuclear is "we'll hopefully keep those emissions local but emit for a very long time").Two points to make, 1) you've missed Duncan Buchanan of the road hauliers association taking aim at LTNs in the same session and making some exaggerated claims about less than 1 mile travel is like 0.04% of mileage that needs to be fact checked.
And possibly bigger problem 2) they were talking about road pricing in the session as a means to cover the drop in revenue from VED & fuel duty when we all switch to electric vehicles...specifically to pay for the ongoing upkeep of the roads !!! In other words the select committee is working on the premise VED & fuel duty are road taxes which pay for our roads and what can they do to fill the funding gap & use road pricing to pay for roads in the future
I don't think it is to pay for roads it is part of the general tax take to pay for all services.
The current preference to keep direct taxes low and increase indirect taxes, so of course they are going to replace ved with a tax linked to driving. The tax base is so huge, they can't afford not to and ideogically haven't much choice (NI aside).
We will still be paying for roads via council tax to the county council or unitary council for where we live.
it shouldnt be, but in that hearing session, at least the first hour,I gave up after that, no one once clarified roads were largely funded by other taxes as well and VED/Fuel duty was a tax on emissions, road pricing in the way questions by the MPs were put and even the answers by the people giving evidence back, was very much that VED/Fuel duty was a road tax, and road pricing was the alternative way to keep our roads paid for to replace it.
Interesting and possibly beneficial for other road users, but how would it avoid taxing ICE vehicles twice? The driver already pays a significant amount in fuel tax, which electric vehicles don't, and they'd be paying to use the road as well. To be fair, surely the only way is to tax electricity used for evs at about the same as ICE fuel?
It wouldn't, and that might be the point.
If electricity is much greener than petrol/diesel (which it should increasingly be) then it wouldn't seem sensible to tax it in the same way as fuel. I also don't think that it would be feasible to have different rates of tax for domestic and transport electricity.
Smart Meters are for demand based pricing. So the supplier has access to your usage data and if obliged by OffGen would tell HMRC too...
And the capital cost in £ Bn is what exactly?
Fairly easy to come up with a high level concept. Realising the concept in detailed terms is something rather different.
Have you ever implemented anything at all ?
Not in £Bn, since the Smart meter infrastructure is already the industry plan, and making further use of the same data is an IT opportunity, thus £Mn only.
Only 30+ years implementation
work with industry and government. So I've seen quite a bit of expediency and low ambition.
Most of the more successful organisations now didn't exist when I started so that suggests there are some who can innovate and deliver.
I propose a tyre tax. It would be based on the load rating and mileage rating of the tyre. If a tyre fails (through puncturing or massive damage, not tread wear) before its normal life, it could be turned in for a pro-rated refund of the tax.
Advantages
Disadvantages
My next car...
With Challenger 3 in design and procurement, the British Army will be selling the surplus Challenger 2 that they don't convert. So no need to settle for a surplus Warrior AFV when you can go the full Chally. It works for the RTC...
PS:Watch out for vulnerable road users in their little HGVs...
Here's an example making a typical car revenue neutral to replace just the 57.95 p/L fuel duty (VAT not included here) using a tyre tax.
Someone on here suggested a tax wrapped up in the mot. It would be a simple mileage one, so would not be popular for rural areas.
I think it's a lot easier to fool or disable an odometer than to drive, but not use up your tyres.
Given how many people are on set mileage lease/PCP schemes if it were that easy to fool an odometer surely such shenanigans would already be widespread?
So far Volkswagen Audi Group is looking at a €5 Billion cost for trying to mess with their OBDII data.
if you don't actually make the equipment, it's a tamper proof black box, so not trivial to 'fool'. Multiple sensors are involved so unlikely to get them all. Some, like GPS are monitored as part of national defence infrastructure, so would be noticed..
You could always add a set amount of tax-free miles based on your post code.
Rural postcodes would get more.
Alternatively a mileage based tax plus congestion charges for major cities would mean less tax for rural areas.
The simple mileage tax would cost virtually nothing to implement though so seems an easy way forward.
DVLA would need to chase up a bit harder on those drivers with no mot (or insurance).
I suppose there would need to be a mot at the end of year 1 as opposed to the end of year 3.
Better to have something simpler even if a bit rough and ready.
Absolutely, the vehicle change of ownership is a fully broken system.
Typically, when new cars are sold on finance, the proof of identity and address is rigorous since their loan is at risk.
For second hand sales there is no requirement to prove identity or address so as long as the seller gets paid, why should they care what is true.
When the second buyer hits a cyclist and drives off, the police have only the DVLA record of the registered owner, a Mr Michael Mouse of Acacia Avenue, NW2.
When the police eventually attend the property there is no sign of Mr Mouse, nor knowledge of the vehicle.
Case closed. .
Since most vehicles are older than 3 years, so subject to MOT inspection, the motor trade has industrialised inspection with ramps and OBDII diagnosis plus manufacturer specific enhancement so that the statutory fee provides a profit.
I guess they would be happy to inspect all vehicles, with the safety benefits that could arise. After all the innovation, the complexity of hybrid or electric vehicles puts us all at risk..
Range anxiety trumps battery durability anxiety, but only just, so regular expert checking is good.
Yes, I thought that was a genius idea too
it would also not be popular to be hit with a bill for 3 years worth of mileage once the car gets its first MOT. Or I can sell if at 2 years and 10 months and let the unfortunate buyer pick up the tab for my road pricing.
Pricing on fuel is convenient, easiest way to replicate this is by pricing onto the car charger, so electricity for cars is not cheper than electricity for general use. (considered against use at the same time) off peak charging may still be cheaper than on peak clothes washing per kwh.
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