ROAD TAX CHANGES:-WHO GAINS? WHO LOSES?

An abolition of Vehicle Excise Duty (VEND) would result in the structure of motor taxation reflecting the pattern of car use rather than car ownership. This is consistent with the present government's taxation policy of shifting the burden from direct to indirect tax and has several other major advantages. VED was a tax conceived in an age of low energy costs and also low administrative costs. The patterns of car use indicate that cars in high income households have a significantly higher annual mileage than cars in low income households. The proposed change to a petrol tax will merely revise the current position where low-income households pay proportionally more road tax per mile travelled. The urban/rural and regional furore that this tax change has provoked appears to considerably outweigh the size of the regional differences that actually exist. The 8% overall difference in rural/urban annual car mileage is offset by improved petrol consumption due to less traffic congestion in rural areas. The comparison of petrol used per vehicle shows that the average motorist in Scotland uses 3% more than an English motorist and a Welsh driver 6% more. Only Northern Ireland is appreciably different where petrol use is 15% higher per car than in England. Northern Ireland may, therefore, merit a regional tax rate different to Great Britain. The analysis suggests a 19/20p a gallon increase is an appropriate rate to levy the tax, but that the calculations upon which this figure is based are subject to a margin of error. But unless special provision is made, motorcyclists will pay an average of found4 per annum more tax under the petrol tax system. It is concluded that the replacement of VED by petrol tax would be consistent with taxation policy, goals for energy conservation and an integrated transport policy as well as improving administrative efficiency and lessening tax evasion while not adversely affecting regions of Great Britain or unduly advancing the interests of the urban against the rural motorist. (TRRL)

  • Corporate Authors:

    Open University, England

    New Towns Study Unit, Walton Hall
    Milton Keynes,   England 
  • Authors:
    • Cousins, Stephen
    • Potter, S
  • Publication Date: 1979-2

Media Info

  • Features: Photos; References; Tables;
  • Pagination: v.p.

Subject/Index Terms

Filing Info

  • Accession Number: 00310307
  • Record Type: Publication
  • Source Agency: Transport Research Laboratory
  • Report/Paper Numbers: Monograph
  • Files: ITRD, TRIS
  • Created Date: Aug 27 1980 12:00AM