[Ian]

Increasingly, people are mentioning that the Government will be loosing income from tax on cars and fuel with the movement to electric vehicles. To counter this does anyone have any information on the amount of money that will be directly saved, for example, by the NHS by the reduction in treatments for patients affected by vehicle pollution e.g. asthma, emphysema, COPD and so on as well as treating the various cancers attributed to environmental toxins?

There is also the sheer loss to the economy by premature deaths, i.e. loss of trained workers, loss of consumers, reduction of output, time off work, not to mention the emotional factors.

I understand that a common figure used by many UK government departments to calculate this ‘value of a prevented fatality‘ is £1.8 million per early death and to the US EPA the ‘value of life’ is currently calculated as $9.1 million. Wikipedia mentions forty thousand premature deaths each year in the UK to air pollution alone, costing around £40 billion each year.

Can anybody refine these figures and how do they compare with estimated electrification tax losses?

 

[ArthurGreenWorld]

I haven't a clue tbh but it is a good point. However we can see government finance has taken a HUGE hit (war debt level) and they will be looking to raise as much cash as possible in a years time.
So I expect tax hits in all over the place... Especially if they do not want to go back to austerity measures.

 

[Aleras]

The money saved will be tiny in monetary terms compared from loss of tax revenue.

Road tax will return when most people have EV obviously. The big one is Fuel duty it raises billions a year.

It's likely they will legislate all new vehicles must have telematics installed. It's already widely used. It will then be taxed on mileage. I don't like the big brother direction of travel but a fair way of calculating the tax due.

 

[richtrash]

If people are living longer they will require more care for other ailments so these will probably balance out, the only way I can see the government recovering the loss of tax raised from fuel is to introduce road charging, it would be relatively easy to install ANPR at motorway junctions and along major trunk routes, a lot of councils will be putting up ANPR to cover the emissions zones they are introducing. Installing ANPR cameras would also have the additional benefit of catching tax, MOT and insurance offenders and could also be used to enforce speed limits.

 

[MudflatsRichard]

I read somewhere that the fossil fuel industry gets vast government subsidies. (Just checked, thanks Google.... Estimates between £6.5 and £12 Billion.) Cutting those subsidies would help replenish the coffers...

 

[farmergiles]

If people are living longer they will require more care for other ailments so these will probably balance out, the only way I can see the government recovering the loss of tax raised from fuel is to introduce road charging, it would be relatively easy to install ANPR at motorway junctions and along major trunk routes, a lot of councils will be putting up ANPR to cover the emissions zones they are introducing. Installing ANPR cameras would also have the additional benefit of catching tax, MOT and insurance offenders and could also be used to enforce speed limits.

i can see where the ANPR cameras have a role to play but the cost of installing enough to make road charging work would be enormous and third parties will operate them and they are not 'not for profit' companies.
We already have the infrastructure to collect mileage data - its the MOT stations which can validate odometer readings annually. (a 2min visit for pre full mot vehicles isn't a major hardship imho)

All road charging will do is to drive vehicles onto the back roads where there are no cameras. I can drive most of the way to Scotland on minor roads, and often did when I was in my camper, to avoid the traffic and have a leisurely drive.

 

[ArthurGreenWorld]

I think I read that over 600,000 vehicles are not taxed and God knows how many are not insured.
ANPR and road charging is not really going to work on them. It will work for the honest folk on this forum but they will need to come up with something much better to stop the tax avoiding sc*m not paying their way and in the process making us all pay more.
So some ideas...
1) vastly increase number of police and or tax vehicle recovery units to remove and scrap/strip for parts any vehicle not registered and paying tax. Night time removals.

2) get stopped driving an untaxed or unregistered vehicle and owner receives a minimum £5k fine and vehicle taken. Driver if not owner get £1k fine.can be taken from wages or benifits.
Non payment automatic prison sentence.

3) New vehicles have built into them Kill switches that can be activated if nessesary if vehicle stolen.. used in crime.. Tax revenue not paid... If these are disabled by owner vehicle the vehicle is taken. And punishment as point 2.

Fed up with the majority of us putting up and paying for ****.

 

[Mr_ess_jay]

The effects on improved health will always lag a fair way behind the change over to electric cars so it's the gap that will require management.

 

[Petriix]

There's no reason that taxation revenue streams have to remain attached to driving. There are plenty of other places where money can (and should) be raised instead. Per mile charging could be applied to commercial vehicles only as they're the ones profiting from the infrastructure.

 

[Snax]

I think I read that over 600,000 vehicles are not taxed and God knows how many are not insured.
ANPR and road charging is not really going to work on them. It will work for the honest folk on this forum but they will need to come up with something much better to stop the tax avoiding sc*m not paying their way and in the process making us all pay more.
So some ideas...
1) vastly increase number of police and or tax vehicle recovery units to remove and scrap/strip for parts any vehicle not registered and paying tax. Night time removals.

2) get stopped driving an untaxed or unregistered vehicle and owner receives a minimum £5k fine and vehicle taken. Driver if not owner get £1k fine.can be taken from wages or benifits.
Non payment automatic prison sentence.

3) New vehicles have built into them Kill switches that can be activated if nessesary if vehicle stolen.. used in crime.. Tax revenue not paid... If these are disabled by owner vehicle the vehicle is taken. And punishment as point 2.

Fed up with the majority of us putting up and paying for ****.

i guess if they start taxing cars properly there will be a hit elsewhere to the economy. if person X pays £100 a year and Y keeps that in his pocket, he will presumably spend that £100 on something else. So you merely switch that £100 from vat or income tax, to the vehicle tax.

im not saying don’t tax vehicles at all, just that could be why they don’t bother being too strict

 

[Mr_ess_jay]

It's a populist governmental system, they'll always appease the masses even if it's not the right thing to do.

It's one of the reasons I'm an advocate of 8 year terms, the government will then be forced into action on its promises instead of just kicking the ball to the next parliamentary term and blaming the last lot. 5 years is just about the right amount of time to argue over expensive things and get the next lot to do it or spend 5 years arguing why they shouldn't.

But I digress....

 

[mad_rich]

I've posted this link a couple of times before, but it's relevant again here. The IFS has a paper on exactly this: the black hole that will created by loss of VED, fuel duty & VAT (£40bn a year, or 5% of Govt revenue), and the social costs of motoring.

Their finding is that congestion - not air quality, CO2 or accidents - is the biggest social cost. And that won't solved by a switch to EVs.

So there are certainly health benefits to the switch to EVs, but don't expect to be welcomed with open arms by the exchequer for all the good you're doing. Expect time-based road pricing. You'll probably pay more per mile for peak-hour city driving than today's ICE drivers pay in duty.

A road map for motoring taxation | Institute for Fiscal Studies

Taxes on motoring raise around £40 billion a year for the exchequer (around 5% of government revenue), equivalent to about £750 per adult in the UK. Most of this comes from fuel duties, which in 2019–20 are expected to raise £28 billion in their own right plus an additional £5.7 billion from the...

www.ifs.org.uk

 

[ArthurGreenWorld]

i guess if they start taxing cars properly there will be a hit elsewhere to the economy. if person X pays £100 a year and Y keeps that in his pocket, he will presumably spend that £100 on something else. So you merely switch that £100 from vat or income tax, to the vehicle tax.

im not saying don’t tax vehicles at all, just that could be why they don’t bother being too strict

Yes you are right to a certain extent.. but £100 to the government in tax is a full £100.. not the same as £100 to the corner shop who will only pay 20% vat to gov there for and 80% loss of the potential tax revenue..

 

[farmergiles]

I can see us ending up with a mix of regimes:
1) Road pricing / congestion charing using ANPR, with detection of uninsured vehicles.
2) VED bands based on, for example, vehicle weight - simple and logical - big heavy EV SUVs pay more than small, light cars.
3) Telematics for business vehicles so they are charged monthly for the actual miles driven (also includes private cars used for business)
4) MOT based annual mileage checks for the rest of us. You declare your anticipated annual mileage when you buy the vehicle (new or used) and pay monthly according to this. If you drive less, the overpayment is carried over, much like domestic energy charging or the DD amount increases until you have caught up.

 

[booms]

I've posted this link a couple of times before, but it's relevant again here. The IFS has a paper on exactly this: the black hole that will created by loss of VED, fuel duty & VAT (£40bn a year, or 5% of Govt revenue), and the social costs of motoring.

Their finding is that congestion - not air quality, CO2 or accidents - is the biggest social cost. And that won't solved by a switch to EVs.

So there are certainly health benefits to the switch to EVs, but don't expect to be welcomed with open arms by the exchequer for all the good you're doing. Expect time-based road pricing. You'll probably pay more per mile for peak-hour city driving than today's ICE drivers pay in duty.

A road map for motoring taxation | Institute for Fiscal Studies

Taxes on motoring raise around £40 billion a year for the exchequer (around 5% of government revenue), equivalent to about £750 per adult in the UK. Most of this comes from fuel duties, which in 2019–20 are expected to raise £28 billion in their own right plus an additional £5.7 billion from the...

www.ifs.org.uk

A really interesting read that. I remember you like your numbers and I've thrown this together instead of working.

My gut was that the impact of transitioning to EVs wouldn't be felt that fast, so I was surprised how much that it actually was.

Assumptions:

• Straight-line increase in EVs as a percentage of sales until 2030 when it's 100%
• Average lifespan of cars are 14 years
• I've kept the total car population at 30m

Obviously lots of moving parts but don't think my assumptions are too far off.

By 2030 about a third of cars on the roads are EVs and the government is down about £12.7bn. Chunkhy. The entire police budget is only £10bn, for example.

 

[6652]

The entire police budget is only £10bn, for example.

It was just over £15Bn for 2020/21, for England & Wales, but take your point!

 

[Swagman]

There's no reason that taxation revenue streams have to remain attached to driving. There are plenty of other places where money can (and should) be raised instead. Per mile charging could be applied to commercial vehicles only as they're the ones profiting from the infrastructure.

No driving to work then?
To profit from your employers wages they pay through profit?
However, I agree, taxing vehicles doesn't have to be the de facto form of raising revenue, but I don't see any government thinking outside of the box on the issue.
Personally, I think we should all pay more tax regardless, a flat amount dependent on earnings, rather than frivolous ones here and there based upon consumption.

 

[Mr_ess_jay]

2) VED bands based on, for example, vehicle weight - simple and logical - big heavy EV SUVs pay more than small, light cars.

This is a great idea, it will force efficiencies in weight which positively impacts vehicle performance and efficiency, maintenance on the vehicle, maintenance of the roads and will hopefully drive people driving 7 seat SUV's on their own into smaller vehicles.

If I could shift 250kgs from my car, it'll be a totally different animal.

 

[richtrash]

I dont pay VED on my car, a lot of EVs dont pay it, vehicles over 30 years old dont pay it, I guess it doesnt amount to much at the moment but it will do once people start switching over to EVs.

 

[Cymon]

It's vehicles over 40 years old that don't pay VED in the UK...