Motorists pay for roads, yes? No. All tax payers pay for roads, not just motorists. Those who pay income tax and those who pay council tax are the ones who pay for roads, and that’s not just motorists. And anybody who buys anything in Britain also helps to pay for roads because VAT also contributes to the national coffers. Businesses which pay business rates also contribute into the national coffers. And that’s where the money for roads comes from: the consolidated fund, the treasury’s pot of cash that pays for everything. No taxation in the UK is ring-fenced i.e raised by one set of users, and spent on that set of users. But what about ‘road tax’? Clearly, the name says it all, you might think, it’s a tax that pays for roads! Sorry, no, ‘road tax’ doesn’t actually exist. It was abolished in 1937, along with the ‘road fund licence’. It’s now car tax, a UK tax on tailpipe CO2 emissions above 100gm per km*. It’s not now, and never has been, a fee to use roads.
Despite being 75 years past its sell-by date ‘road tax’ is a term that refuses to go to where the other long-gone duties have gone (anybody out there still paying ‘window tax’, abolished 1851)? Anyway, no big deal: ‘road’ and ‘tax’, just two little words. But, for the few minutes it’ll take to read the rest of this short article, let’s imagine ‘road tax’ did exist. If it existed, who would pay it, and who wouldn’t, and why?
1. Drivers who own the Volkswagen Golf 1.6 TDI Bluemotion 105 don’t pay ‘road tax’*:
2. Drivers who own the new Volvo V40 won’t pay ‘road tax’*:
3. More than one million disabled drivers don’t pay ‘road tax’:
4. Children don’t pay ‘road tax’ even though they sometimes have to use roads when walking or cycling to school:
5. Horses don’t pay ‘road tax’, even though they use roads and have most definite tailpipe emissions:
6. Electric vehicles don’t pay ‘road tax’:
7. Tractors don’t pay ‘road tax’:
8. Cyclists don’t pay ‘road tax’:
9. Police cars don’t pay ‘road tax’:
10. The owner of this Rolls Royce does not have to pay ‘road tax’ because it was built before 1973. Motorists with pre-1973 cars don’t pay ‘road tax’:
MORE SUBSIDIES: Band A motorists, disabled drivers, police cars and tractors and so forth are supplied with tax discs showing they pay zero for their ‘road tax’. A Freedom of Information request found that the cost of a tax disc is £1.47 for those bought at a Post Office, and 95p for those bought online.
But let’s keep it simple and say the cost to print, distribute and sell each car tax disc is a quid. There are about 2 million vehicles which don’t pay car tax. That’s two million quid of subsidy to get tax discs to those who don’t pay for them. Hang on, though, the DVLA charges £7 for a replacement tax disc so scrub the quid-per-disc figure, let’s be more realistic and calculate some costs using £5 per disc: those motorists who pay nowt for their car tax are actually subsidised by £10m.
MOBILITY SCOOTERS CAN TRAVEL AT 8MPH & ARE ALLOWED ON DUAL CARRIAGEWAYS: Class 3 invalid carriages are allowed on roads, but are limited to 8mph. According to the DVLA, “You don’t have to pay vehicle tax for any mobility scooter or powered wheelchair, but you still need to register class 3 invalid carriages and display a ‘nil value’ tax disc.” The Department for Transport adds: “You can’t drive on bus lanes, ‘cycle only’ cycle lanes and motorways.” But despite what newspapers may think, mobility scooters can be driven on trunk roads, although the DfT advises: “You should avoid using dual carriageways with a speed limit of over 50mph….If you do use it on a dual carriageway, you must use an amber flashing light for visibility.”
MOTORISTS WHO WANT CYCLISTS TO PAY ‘ROAD TAX’ WOULD PAY MORE ‘ROAD TAX’: Some motorists want cyclists to “get off the road” until they pay ‘road tax’. Do they realise that bicycles, as non-polluting vehicles, would be classified as Band A vehicles and hence would have to pay the same as cars that pay nothing for their ‘road tax’? With 25 million bicycles in ownership, that would be £125m to get each bicycle a valid tax disc. Do motorists really want to pay a lot extra for their car tax to subsidise registration and duty compliance for millions of bicycles?
‘Road tax’ is car tax, a tax on car emissions. Its full and proper name is graduated vehicle excise duty, VED for short. VED, car tax, vehicle tax, whatever you want to call it, is not a fee to use the road. Much more info on this here.
If you’re now confused, thinking ‘if road tax doesn’t exist, what pays for all that tarmac I drive on?’, there’s a simple answer to this: roads are paid for out of general and local taxation. Motorists don’t pay for roads, we all pay for roads. We all have equal right to use those roads.
YOU OWN A CAR, NOT THE ROAD: Payment of ‘road tax’ does not give anyone the right to demand “their” roads are pothole-free, widened to allow greater speed or ‘improved’ in any way. Paying a few hundred quid a year – even if ‘road tax’ did exist – wouldn’t go anywhere near paying a fair proportion of the negative externalities of mass motoring.
THE OLD CHESTNUT: ‘ROAD TAX’ IS A FEE TO USE THE ROAD
Those who believe VED is fee to use roads sometimes use the seemingly-convincing ‘off-road’ argument:
“Doesn’t matter what you call it, VED/car tax/’road tax’, it’s a fee to use the public road because if you don’t pay it, you can’t drive on the public road. For instance, if I elect to use a vehicle off-road, I don’t need to pay VED. If I then choose to use the vehicle on a road, I would have to pay VED. If the vehicle emitted a certain amount of CO2, then yes that VED is currently free, but I would still have to get and display a tax disc in order to use the car on the road.”
But car tax isn’t a fee to use the road, it’s very much a tax on car emissions. Many cars, which use the public road, do not pay any ‘car tax’ because they emit less than 100gms of CO2. If car tax was a fee to use roads, electric cars and low-emissions cars wouldn’t be able to drive on UK roads.
Nor is it true that vehicles that will be driven off-the-public-highway – on private roads – don’t have to pay Vehicle Excise Duty.
VED is charged under section 1 of the Vehicle Excise and Registration Act 1994, as amended, “in respect of every mechanically propelled vehicle that … is used, or kept, on any public road in the United Kingdom”. For England, Wales and Northern Ireland ‘public road’ is defined in section 62(1) of the 1994 Act as “a road which is repairable at the public expense”; for Scotland a public road is defined in section 151 of the Roads (Scotland) Act 1984, as amended, as “a road which a roads authority have a duty to maintain”. However, the DVLA has powers to clamp vehicles that are not on the public road if they are in breach of the VED continuous registration requirements. The explanatory notes to the Vehicle Excise Duty (Immobilisation, Removal and Disposal of Vehicles) (Amendment) Regulations 2008 (SI 2008/2266) state:
The policy intention is to prevent evaders of vehicle excise duty from using off-road areas such as unadopted roads, commons, public car parks or roads maintained by Housing Associations to place themselves beyond the reach of the enforcement authorities.
Farmers can get ‘agricultural use’ exemptions from VED for their Land Rovers, so long as they only travel a mile or so on public highways. And in one special circumstance, cars which emit loads of CO2 can still drive on UK public roads without paying car tax. But only for a short distance. When a SORN (Statutory Off Road Notification) vehicle is going to a pre-arranged MOT test, and the vehicle has valid insurance for the journey, it can be driven on public roads without paying a penny for use of those roads.
Furthermore, if a car is registered in the UK but is never driven in the UK it still has to pay the UK’s Vehicle Excise Duty. So, a UK-bought car driven in France by a UK-born person who’s moved to France permanently, may never drive on UK roads but the car still has to pay VED. This is because it’s a tax on the car, not a fee to use the roads.
* Other cars which don’t pay ‘road tax’ (apart from all cars, because ‘road tax’ doesn’t exist) include:
Kia Picanto • Fiat 500 • Peugeot 207 • Ford Fiesta 1.6 TDCi 95 Econetic • Vauxhall Corsa 1.3 CDTi ecoFLEX • Audi A1 1.6 TDI • MINI One 1.6 • Citroen DS3 1.6 e-HDi • Volkswagen Polo 1.2 TDI Bluemotion
MINI Cooper D 1.6 • Volvo C30 1.6 DRIVe • Volkswagen Golf 1.6 TDI Bluemotion 105 • Audi A3 1.6 TDI Stop/Start • Volvo V50 1.6 DRIVe
All of these cars are in Vehicle Excise Duty band A because they emit less than 100gms of CO2 per km. According to the Society of Motor Manufacturers and Traders there are currently 65,000 such band A vehicles driving on the roads of the UK. However, because the number of these low emission cars is rising, the Government is losing out on loads of lolly. This can’t go on. At some point the Government will reduce the CO2 threshold. In this ‘road tax to be hiked’ story Auto Express magazine claims that senior motor industry figures predict the Government will reduce the threshold to 85g/km: “Industry insiders suggest only cars emitting 85g/km and below would be exempt in 2016 – excluding Ford’s new 87g/km Fiesta ECOnetic – and that this will be cut annually to 2020.”
This piece was inspired by a robust – and rude – posting on the forum of moneysavingexpert.com (so rude and sweary it appears to have been deleted). Pic of children from Heatherton.