New road tax for cars?

[Waldo]

This makes a lot of sense and it would also mean if your car sat on the drive for a year polluting nothing, it would cost nothing.

 

It also means people who don't pay VED (because they're crooks), still end up making some contribution. Also, no need to police the system, and no need for all the administration associated with VED.

 

Seems quite sensible and efficient, no wonder the government haven't thought of it yet!

 

---------- Post added 07-08-2015 at 17:37 ----------

 

As far as I'm aware the new rules will only apply to cars registered after 1st April 2017, so if you buy a car now you're tax band won't move.

 

 

 

http://www.telegraph.co.uk/cars/advice/new-car-tax-rates/

 

Thanks geared, that's just what I wanted to know.

[El Cid]

This makes a lot of sense and it would also mean if your car sat on the drive for a year polluting nothing, it would cost nothing.

 

I would not expect to pay nothing, I did around 4,000 miles last year, so even in my polluting 1.4 Scenic, I would have emitted a lot less pollution in to the air than most.

My VED was due about 7 days ago, I had best pay it, I think its £205

[TimmyR]

It also means people who don't pay VED (because they're crooks), still end up making some contribution. Also, no need to police the system, and no need for all the administration associated with VED.

 

Seems quite sensible and efficient, no wonder the government haven't thought of it yet!

 

There would probably be outcry at any increase in fuel duty, which would explain why the government haven't done this.

[geared]

If he were truly thinking outside the box he'd abolish VED and make up the difference with a fuel duty increase. Then those who USE the most would pay the most, rather than it being related to your car efficiency (which is clearly not fair).

 

IIRC doing so would need a 20-30p increase on the price of fuel.

 

That would include the fuel used to deliver all goods to business and residential places, also public transport (although they do have a discount on fuel).

 

Instant spike in inflation, cost of living would increase as the cost of delivering goods would absolutely rocket, yadda yadda yadda.

 

Currently the 'outdated' system is in a way subsidising everyones cost of living.

[El Cid]

 

Instant spike in inflation, cost of living would increase as the cost of delivering goods would absolutely rocket, yadda yadda yadda.

 

 

The new living wage will do that, it does not mean it should not be done, we will cope.

[Cyclone]

Lets do a rough calculation (it's very rough, but it should give us an order of magnitude).

 

VED raised £5.6 billiion in 2009, I'll work with that figure;

 

VED and fuel tax together raised £32 billion in the same year, so fuel duty at the 2009 rate raised £26.4 billion.

 

As a proportion then, in 2009 fuel duty would need to go up by 17.5% if it were to replace VED income.

At the time fuel duty was (on average) 55.5p/litre.

So the increase would have been less than 10p/litre.

 

It currently stands at 58p/litre, I doubt that much has changed in the underlying figures.

 

VED for HGVs is very much higher than for domestic vehicles, but if some finessing were required they could be given the ability to offset some of the fuel duty they pay as a business expense or against corporation tax.

 

So there's no reason that the cost of living would be affected at all, delivery vehicles and public transport could be made entirely exempt, or more likely just charged fuel duty at a slightly reduced rate to ensure that the overall payments they make didn't change significantly.

 

---------- Post added 13-08-2015 at 11:37 ----------

 

So what would an extra 10p/litre mean for a driver of a car that does 40mpg and who drives 10k miles/year.

 

That's 1135 litres of fuel a year. So that's £113.50 increase in fuel costs for this average guy.

 

It's more difficult to say how much he'll save, as that's dependant on CO2 emissions (which is exactly why we want to replace this system because if he drives a million miles a year in a low CO2 vehicle he pays less tax than someone drive 10 miles a year in a high CO2 vehicle).

 

A Ford Focus 1.6 gets slightly better than my estimated 40mpg (making it cheaper than my estimate in the new system), it's current tax is £130/year.

 

So for the average driver of a mid range Ford Focus they save £20 - £30 a year.

 

Personally, my car does terrible mileage, 20mpg. But I drive only 2000 miles. Under the fuel duty system it would cost me £45. My current tax is £240, so I'd save a lot by the fact that I don't drive very much.

If I drove 10k/annum I'd break even or thereabouts.

This seems eminently fair to me.

[shand1]

Under the current system... my attitude is that i have paid my road tax in advance, so i want my moneysworth from it & i'm going to use my car as much as possible.

If we get rid of this system, & added it on to fuel, i would most likely use my car less !

[geared]

Under the current system... my attitude is that i have paid my road tax in advance, so i want my moneysworth from it & i'm going to use my car as much as possible.

If we get rid of this system, & added it on to fuel, i would most likely use my car less !

 

and if your view is shared by the rest of the population (I bet it would be) then we'd probably see a decent fall in emissions from cars.

[mattleonard]

Interestingly, when Osborne mentioned the "road tax" in the budget, the specific example of use which he prefaced it with was the building of new motorways. Which - unless he's also intending to allow cyclists to ride on motorways - rather throws a spanner into the already well-spannered spanner in the works.

[altus]

Interestingly, when Osborne mentioned the "road tax" in the budget, the specific example of use which he prefaced it with was the building of new motorways. Which - unless he's also intending to allow cyclists to ride on motorways - rather throws a spanner into the already well-spannered spanner in the works.

 

He also said it was going to be tax neutral compared to the current scheme.

 

Same tax - more spent on new motorways = less money to maintain the existing road network.