Pay per mile
New road taxing system fit for the future
The prospect of ‘pay-as-you-drive’ has been raised again, this time looking at the issue of electric vehicles (EVs) and their current zero road tax status.
EVs also pay no fuel duty, and as heir numbers grow, then the government is increasingly losing out he. it comes to Treasury income.
The Centre for Policy Studies, in its report ‘The Future of Driving’, recommends that zero emission vehicles (ZEVs) should be charged a flat rate for every mile they drive. This would still incentivising as they would be paying significantly less than their petrol and diesel counterparts.
In the report, The Centre for Policy Studies says that there are a variety of technological options that could be used to implement such a scheme. These range from low-tech (submitting your mileage manually) and mid-tech (an on-board device that transmits mileage automatically) to high-tech (GPS tracking).
All owners would receive a set allocation of tax-free miles every year. This could be adjusted so that, for example, those living in remote areas with fewer transport alternatives would receive a bonus.
As the proportion of EVs on the roads grows, a per mile charging system could be amended accordingly. It would eventually replace fuel duty and vehicle excise duty for all vehicles. This would ensure Treasury income from the roads into the future.
It ain’t heavy
Vehicles would be assigned a per mile rate based on weight. This would better reflect wear on the roads, and charges could be collected automatically by direct debit every month.
Free mileage allowances would be based on postcodes in an attempt to allay public fears over the changes.
“Our recommendations take into account public feeling on a variety of proposals, privacy concerns, and their financial impact,” states the report’s co-author, Dillon Smith. “A solution which can lead to fairer, better, and more efficient taxation while tackling congestion and improving air quality in our big cities.”