Revenue from car tax falls by £93m

21/07/2016 | HIGHWAYS REPORTERS

Revenue from vehicle excise duty has fallen by £93 million in the year following the abolition of the paper tax disc, the Driver and Vehicle Licensing Agency’s newly published annual report and accounts show*.

The DVLA’s accounts show revenue from vehicle tax fell from £6.023 billion at the end of March 2015 to £5.930bn a year later.

The RAC, which was fearful that the impact of the scrapping of the tax disc would lead to a loss in revenue due to increased evasion, is now concerned the loss has proved to be even greater than the government’s own estimate of £80m over the course of 2015.

A year ago the Department for Transport conducted a roadside survey which projected that about 1.5% of all vehicles on the road were unlicensed – the equivalent of about 560,000 vehicles – a rate of 1.4% unlicensed vehicles, compared with 0.6% in 2013 – or the equivalent of 210,000 vehicles.

As a result the Department's statisticians estimated a loss to the exchequer of around £80m. In Great Britain specifically they estimated annual losses would rise from £35m in June 2013 to £78m in June 2015.

While the RAC understands there may be other factors affecting the DVLA’s revenue loss such as greater numbers of ‘cheaper to tax’ low carbon emission vehicles being taxed, it is concerned the figure may continue to rise in the coming years as a result of increased evasion.

In order to understand the true extent of the evasion problem, the RAC believes another roadside survey of unlicensed vehicles should be carried out this summer – a year earlier than it would normally be undertaken – so the government can get an up-to-date assessment of the evasion situation.

RAC spokesman Simon Williams said: “It is worrying that the reduction in revenue from vehicle tax has exceeded the government’s own estimate. Some may argue that a £93m loss is only £13m higher than expected, this represents an increase of £58m on the corresponding period before the tax disc was abandoned and far exceeds the £10m savings arising from no longer issuing tax discs. This loss is a significant sum and one that merits further investigation.

“We urge the Department for Transport to carry out another roadside survey of unlicensed vehicles this year to fully assess the untaxed vehicle situation. If this were to find that the number of untaxed vehicles is still at the same rate as when the last survey was conducted or, worse still, has increased, then action needs to be taken urgently to counter this.”

In September 2014 the RAC estimated the Treasury could lose up to £132m on top of the £35m the DVLA said was lost from evasion the year before, making for a total loss of £167m. This was based on vehicle tax evasion following a similar path to the number of uninsured drivers of which there are believed to be around one million illegally using Britain’s roads.

Highways InProfile

latest magazine issue
Highways jobs

Highways Maintenance Manager

£51,356 - £55,539 per annum
We are looking for an experienced Engineer to join the team as a Highways Maintenance Manager Selby, North Yorkshire
Recruiter: North Yorkshire Council

Highways Maintenance Manager

£51,356- £55,539 per annum
We are looking for an experienced Engineer to join the team as a Highways Maintenance Manager Brompton on Swale, Richmond
Recruiter: North Yorkshire Council

Permit Officer - Internal works promoter - WMF2244e

£34,434 - £35,412
The streetworks Permit Officer role within the highways service Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Highways Development Management Engineer

£41,816 - £45,175
You will be based in the Highways Development Team and work closely with colleagues across the wider transport service. Northamptonshire
Recruiter: West Northamptonshire Council

Transport Project Officer

£34,203 - £37,067
We are seeking an enthusiastic and motivated project officer to work in our Highways and Transport Service. Northamptonshire
Recruiter: West Northamptonshire Council

Engineer - Structures

£40,777 - £44,075
Join the successful Structures team, and become a vital team member Broad Lane Office, Yate
Recruiter: South Gloucestershire Council

Assistant Traffic Management Technician - WMF2251e

£26,403 - £26,824
Westmorland and Furness Council is seeking an organised and enthusiastic individual Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Senior Traffic Management Technician WMF2256e

£34,434 to £35,412 (pay award pending)
Westmorland and Furness Council is looking for three experienced and motivated individuals Cumbria / Various
Recruiter: Westmorland and Furness Council

Senior Bridge Technician - WMF2257e

£34,434 - £35,412
We are currently seeking to recruit a Senior Bridge Technician to join our Bridges and Structures team. Penrith, Cumbria
Recruiter: Westmorland and Furness Council

Highways Network Officer WMF2263e

£38,220 - £39,152
In this role, you will assist in leading the South Lakes Area Highways team Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Traffic Management Technician - WMF2240e

£28,598 - £29,540
Westmorland and Furness Council is seeking a committed and technically capable individual to join our Traffic Management Team Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Senior Technician-Road Closures

£35,422 - £38,730
The Network Planning division is seeking to appoint someone who is enthusiastic and a team player Derbyshire
Recruiter: Derbyshire County Council

Technician - Road Closures (2 Posts)

£29,719 - £31,691
The Network Planning division is seeking to appoint someone who is enthusiastic, an excellent team player Derbyshire
Recruiter: Derbyshire County Council

Structures Inspector

£Competitive
We are excited to offer a fantastic opportunity for two Permanent Structure Inspectors to join our dynamic SBIM team Bristol
Recruiter: Amey

Highways Maintenance Operative

£Competitive
We have fantastic opportunities for a permanent Highways Maintenance Operatives Kettering, Northamptonshire
Recruiter: Amey

Site Manager

£Competitive
We are excited to offer a fantastic opportunity for a Permanent Site Manager Bristol
Recruiter: Amey

Principal Commercial Manager

£Competitive
The SBIM contract involves delivering inspection and maintenance programmes for National Highways Bristol
Recruiter: Amey

Senior Commercial Manager

£Competitive
We are excited to offer a fantastic opportunity for a Permanent Senior Commercial Manager Nottingham, Nottinghamshire
Recruiter: Amey

Highways Maintenance Operative

£Competitive
We have fantastic opportunities for a permanent Highways Maintenance Operatives. Northampton, Northamptonshire
Recruiter: Amey

Managing QS

£Competitive
In this role, you will support the Senior Commercial team in the end to end commercial process for the Area 12 contract. Yorkshire and the Humber
Recruiter: Amey
SUBSCRIBE NOW

Latest Video

Subscribe to Highways today to ensure you keep your finger on the pulse of everything happening in the UK road network throughout the year.

SUBSCRIBE NOW