In this week’s poll we’re asking whether readers think a “pay by the mile” model should be used to generate the tax revenues that will be lost through the switch to zero carbon motoring.
The UK government is reported to be considering road pricing to make up for an estimated £40bn tax shortfall resulting from the proposed 2030 ban on the sale of new petrol and diesel vehicles.
Expected to be announced this week, the fast-tracking of the ban on sales of fossil-fuelled vehicles from the original date of 2035 has been hailed by some as a sign of the government’s strengthening commitment to its net-zero strategy, and a statement of intent that it’s serious about supporting the low carbon vehicle sector.
However, with taxes on motoring currently raising around £40bn per year, and the bulk of this revenue linked to fuel duties, it’s feared that without significant changes to the tax system the speeded up transition could leave a huge hole in public finances.
The government is said to be considering a number of options for addressing this, including – perhaps most controversially – the introduction of a national road-pricing scheme that would use either road tolls or a “pay as you drive” concept to replace the lost tax revenue.
Road-pricing has been suggested many times in the past, and has never gone down particularly well. When former PM Tony Blair explored the idea back in 2007, motoring groups and the shadow conservative government of the time accused him of trying to introduce a stealth tax and “big brother” surveillance system.
Whilst any serious attempt to revisit the issue is likely to be similarly unpopular with huge swathes of the population, a lot has changed since 2007. And the shift to zero carbon transportation certainly creates a more compelling case for such a scheme.
But should the government press ahead with this plan, it’s going to have to tread incredibly carefully and work hard with industry to develop a technologically complex system that is practical to implement and fair and nuanced in use: which doesn’t – for instance – disproportionately impact communities with poor transport links.
In this week’s poll we’re asking a simple question: is road-pricing the solution to the problem? But as always we would welcome your comments on the complexities of this debate below the line.
Do you think such a scheme is the right solution to the problem? And if so, how should it be structured? Should, for instance, the drivers of the large number of petrol driven vehicles remaining on the roads – who will still presumably be paying vehicle tax – be exempt from the charge?
Perhaps you feel a less divisive solution might be to continue with some form of motoring tax for all vehicles regardless of their green credentials. But then how would this be balanced with the incentives that are currently in place to encourage the adoption of low carbon vehicles?
Or perhaps our relationship with transport technology will have altered so fundamentally by 2030 that none of these things will be issues.
As always, we look forward to hearing your thoughts. Please note, that all comments are moderated.