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.
“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.
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.
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.”