Cars: £280 million lost in switch from paper tax discs - - PressFrom - United Kingdom
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Cars £280 million lost in switch from paper tax discs

16:05  03 december  2019
16:05  03 december  2019 Source:   motoringresearch.com

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Government loses £ 200 MILLION in SIX MONTHS after scrapping paper tax discs . The Department for Transport (DfT) had thought that £ 80m of vehicle tax revenue would be lost in 2015 DVLA has switched to an online system. DVLA chief executive Oliver Morley said: “Almost 99% of all

Ex-Chancellor George Osborne axed paper car tax discsCredit: Splash News. In 2013/14, when they were still in use, car tax losses were £ 35 million but the cost to Treasury since is £ 281 million — £ 94 million of it this year Renewal letters can be sent to old addresses or lost in piles of junk mail.

a close up of a keyboard: tax disc road tax losses © Provided by Motoring Research tax disc road tax losses

Since the scrapping of paper tax discs in October 2014, the ‘upper estimates’ of losses in road tax revenue reach £280 million. This is despite ministers’ claims at the time that it would cut costs and reduce tax evasion.

The RAC Foundation has highlighted that the amount exceeds the sum the government has put aside for the repair of potholes, which was announced in March. The £280 million total comes purely from deliberate tax evasion, or drivers simply forgetting. Broken down, the sum lost from drivers not paying the year before the tax disc was scrapped, was £35 million. In 2019, that’s up to £94 million.

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The decision to scrap paper car tax discs cost the government more than £ 400m in revenue in the first 12 months after the change came into effect, official figures suggest. At the time it estimated that this surge in evasion could cost £ 80m a year in lost vehicle tax revenue, which the department said was

The DVLA has revealed revenue from vehicle excise duty fell by £ 93 million in the year following the scrapping of the paper tax disc – significantly more even than the DVLA’s predicted VED loss. The DVLA’s accounts show vehicle tax revenue fell from £ 6.023 billion in the 2014/15 financial year to £

tax disc road tax losses © Provided by Motoring Research tax disc road tax losses
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“Getting a piece of paper to stick in the windscreen might seem a quaint idea in the digital age, but what we’ve lost is the daily reminder it provided for all to see when the next payment was due,” said Steve Gooding, director of the RAC Foundation.

Drivers simply forgetting to pay their tax has made a significant contribution to that figure of lost revenue. Indeed, 54 percent of those who are found without tax are found around two months after their renewal. This suggests the evasion is accidental.

This is also attributed to the new rule that road tax doesn’t follow a car as it changes hands. This means some new owners may not be aware that it’s on them to tax their new car as soon as they get it, even if the previous owner had taxed it.

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The Treasury has lost an estimated £ 281 million since 2014 due to motorists dodging paying for their tax or forgetting to do so, the Daily Mail reports. DVLA roadside surveys revealed losses from car tax were £ 35 million in the year 2013-14 when the paper discs were still in use.

The scrapping of tax discs has cost the government £ 100 million . Experts say increased evasion by motorists has played a major part in the £ 93 million drop in See today's front and back pages, download the newspaper , order back issues and use the historic Daily Express newspaper archive.

In spite of this, the DVLA claims still that it raises £6 billion every year, including fines of £238 million from those caught missing their tax payments.

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a close up of a device: tax disc road tax losses © Provided by Motoring Research tax disc road tax losses

Likewise, Sir Patrick McLoughlin, the former transport secretary, defends the reforms, says that “the idea that paper discs is the way you stop evasion is nonsense”.

“I wouldn’t want to go back to that system,” he told the Daily Mail.

“We don’t make people put discs in their car to show they’ve paid insurance, and people still renew their insurance.”

The post £280 million lost in switch from paper tax discs appeared first on Motoring Research.

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