A new report urges the government to offer a third off the price of new electric cars – in exchange for participating in a road charging trial.
The Recharging Britain’s Roads Policy report by Greener Transport Solutions, a not-for-profit group overseen by academics, advocates charging road users per mile by the end of this decade. It warned the government faces losing a huge amount of tax revenue from fuel duty and road tax, as drivers increasingly transition to electric cars.
The Treasury collects just over £40 billion in vehicle taxes, with £28 billion from fuel duty, £6 billion on VAT from fuel and another £6.5 billion from vehicle excise duty (VED). EV drivers do not pay fuel duty or VED.
The report – written by David Begg, a former transport advisor to the government, and Claire Haigh, the founder of Greener Transport Solutions – warned a widespread adoption of EVs could be slowed if the government introduced a pay-per-mile scheme without warning.
It suggests gradually phasing in the programme from 2022, with a pilot scheme in a city with a Clean Air Zone. The government could then offer a third off the price of EVs costing up to £35,000, in exchange for the driver committing to pay the new road user charge in 2023.
EVs risk ‘locking in car dependency’
While the report said road charging would be an effective way to claw back lost fuel duty revenue, it warned the transition to EVs risked ‘locking in car dependency’ and claimed this could push up congestion by 30 percent.
‘The risk is that in lowering the cost of motoring, electrification will increase car use and congestion, and make mode shift to public transport and active travel harder to deliver,” says the report.
‘If we electrify the car fleet without sorting out how to transition away from fuel duty, road traffic could increase by 30 percent.’
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