The road tax could be scrapped and replaced with a pay-as-you-drive model. This is largely in response to the steady rise of electric and alternatively-fuelled cars…
Road Tax Is On ‘Borrowed Time’
Road tax and fuel duties contribute a massive £40 billion to the Treasury each and every year. With the rise of zero-emission vehicles, especially electrics, this revenue will slowly disappear; meaning it’ll have to be replaced. According to reports, the government is now considering a pay-as-you-drive model. This would see drivers taxed on how often they drive, literally driving up expense with each mile clocked. The House of Commons’ Transport Committee has said that it wants to open up a “national debate” on the subject.
This isn’t the first time the idea has surfaced. The Labour government in 2007 pitched the idea; but backed down after a petition against it accrued 1.8 million signatures in opposition to the measure. But now the Institute for Fiscal Studies is imploring MPs to consider different ways to compensate for lost monies. These could include the likes of tolls, congestion charges, parking levies and clean air zones.
Fairer And Cleaner?
Nicholas Lyes, head of roads policy at the RAC, acknowledged the need for change. However, he emphasised that many drivers are concerned about paying out more under an alternative to road tax. He said, “there is no question that the existing fuel duty system is on borrowed time as we move towards electric and other zero emission forms of car travel”. He added, “we know through research that drivers are open to a new form of motoring taxation but three-quarters of those we questioned are worried they may end up paying more tax than they do now. For this reason, we believe any new tax should be in place of the current one and not in addition to it”. He added that the organisation had discovered widespread support for a pay-as-you-drive model, with motorists considering it fairer and a useful way of discouraging shorter, needless journeys by car.
Lillian Greenwood, chair of the Transport Committee, sees the change as an opportunity to address much broader issues. She said, “we need to ask how we will pay for roads in the future and in answering that question we have an opportunity for a much wider debate about our use of road space, cutting carbon emissions, tackling congestion, modal shift and how we prioritise active travel.”
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