The tax disc failure: Government loses £80m as number of untaxed vehicles on roads doubles

tax disc composite

Published on 13 January 2016 by Gill

UPDATE: According to The Telegraph, official figures show that the DVLA lost £93 million of revenue following in the year following the removal of paper tax discs.


The decision to scrap physical tax discs on cars and other vehicles has backfired badly according to figures released at the end of 2015.

Instead of saving £10m, the move has ended up costing more than £80m as innocent motorists ended up having their vehicles clamped among many other admin issues.

The number of unlicensed vehicles on the roads has also doubled, with the DVLA towing away around 100,000 cars last year, a 58% increase on 2014. The new scheme came into place in October of that year.

RAC chief engineer David Bizley said: “Sadly, the concerns we raised about the number of car tax evaders going up at the time the tax disc was confined to history have become a reality.

“Prior to the new system going live last October the RAC made the point that enforcement would principally be carried out by automatic number plate recognition cameras as is the case with motor insurance where the exact number of evaders is not fully known, although the figure is thought to be over one million.

“The number of untaxed vehicles in Great Britain has more than doubled from 230,000 in 2013 to 531,000 in the latest statistics and is now at its highest level for eight years. The loss in revenue for the Government is significant having risen from £35m in 2013 to an estimated £80m now and, it has to be pointed out, far exceeds the forecast £10m efficiency saving.

“We really cannot afford for this to increase again for the sake of both road safety and the country’s finances. Hopefully, much of the increase in evasion is due to the system being new and these figures will reduce as motorists become more familiar with how it works.

“The RAC believes it is vital that this survey is repeated in 12 months’ time – if not sooner – rather than in the normal two-year period so we can establish once and for all whether the increase is simply a temporary result of the new system. If, however, evasion continues to increase, then action will have to be taken swiftly.”

 


Main image composite of this and this (blurred).