UK Drivers Could Soon Be Charged For Every Mile They Drive
Chancellor Rishi Sunak is reportedly considering plans to charge motorists for every mile they drive on British roads in a bid to fill a £40 billion tax shortfall.
The shortfall is said to have appeared as a result of the move to electric cars, with the news coming just days after Prime Minister Boris Johnson announced plans to ban the sale of new petrol and diesel cars starting from 2030 onwards.
Road charges are currently limited to schemes such as the London Congestion Zone, the M6 Toll in the West Midlands, the Dartford Crossing on the M25 and levies on a handful of tunnels and bridges, but changes could be made under a new national road pricing scheme that has been presented to the chancellor by the Treasury.
It’s unclear how charges would be calculated under the new scheme, which has been reported on by The Times, but Sunak is said to be ‘very interested’ in the concept.
Tony Blair floated the idea of a national road pricing scheme while he was in power with the Labour Party between 1997–2007, though a petition against the plans reached 1.8 million signatures and the idea was ultimately abandoned.
Since March 2011, motorists have had to pay 57.95p in fuel duty for each litre of petrol or diesel they buy. This brings in £28 billion a year, or 1.3% of national income, while VAT on fuel currently generates almost £6 billion a year. Vehicle Excise Duty (VED), which is charged on the purchase of cars based on their emission levels, is expected to raise £7.1 billion this year.
A government source cited by The Times said the Treasury had analysed potential options for a national road pricing scheme as officials try to figure out how to replace the tax revenues lost with the increase of electric cars, though the source said such a scheme was not ‘imminent’.
A source for the Treasury also pointed out it ‘regularly explores lots of different policy options’, adding, ‘This is no different.’
The prime minister is expected to give further details about his green agenda in the coming days, with reports suggesting he will bring the ban on petrol and diesel cars forward once again. The ban was originally set to begin in 2040, but Johnson brought it forward to 2035 earlier this year.
According to the Metro, Edmund King, president of the AA, commented:
The Government can’t afford to lose £40bn from fuel duty and car tax when the electric revolution arrives. It is always assumed that Road Pricing would be the solution but that has been raised every five years since 1964 and is still perceived by most as a ‘poll tax on wheels’.
A government spokesperson said the PM was ‘taking every opportunity to build on the UK’s fantastic track record for tackling climate change’ with ‘ambitious plans to build back greener’.
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CreditsThe Times and 1 other
Pay as you drive to save the planet: Rishi Sunak considers plan to CHARGE motorists for every mile they drive to fill £40bn fuel tax hole left by early switch to electric cars - as government prepares to launch massive 'reset' green plan