Can anyone explain why it wouldn't be a good idea to put the cost of the Road Fund Licence and basic Third Party insurance cover on the cost of fuel ?
It seems to me that doing so would
preclude tax avoidance and ensure that any innocent parties involved in motoring related accidents would have automatic cover and not have to chase people with no assets.
Although not all foreign drivers have to buy fuel when they visit the UK, any that do would also be contributing in some small way.
Of course there would need to be
some form of body to administer the insurance fund aspect but I don't see this as a major problem and perhaps those at the DVLA could spend their time ensuring the proper ownership registration of vehicles.
Is this a good idea or have I missed something ?
If it is such a good idea, why hasn't this or any other government done it ?
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It is nothing related to being a good idea or not. It is whether or not people would accept it after the political spin and media reporting.
Allied to the terrible redundancies which would ensue when nobody had to administer the RFL any more.
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Mark - Not sure whether you were being sarcastic about redundancies at the DVLA but, if not, the point I was alluding to was that surely there's plenty of other work these people could do such as chasing up and ensuring accurate car ownership registration and checking/following up vehicle mileage discrepancies. Some of these may require changes in the law and/or an extension of the DVLA's powers but why not ? Perhaps they could be responsible for some if not all the the third party 'insurance fund' administration.
I wouldn't envisage huge redundancies in the insurance sector because most drivers would still want to purchase fully comprehensive cover and as I understand it, TPFT cover is becoming less common anyway.
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Hmmmm.
So you put VED on fuel....then how will I get the money back for my two VED exempt vehicles?
Also why should I pay an insurance levy on fuel when I already pay for a trade policy to run/drive anything currently in my care.
And what about my vehicle that legally uses red diesel...it still needs insurance for the times it travels between "fields" but there is almost no tax on that fuel, many who use it never venture on the road.
The current system may not be perfect but we all understand it well, there are some nightmares in the detail for any radical change.
MM
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Seems like a good idea in theory, but makes illegal and smuggled fuel more attractive (as perr Beeb 2 programme last night) as differences between fuel prices increase.
CS
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With RFL it a least there is an up front cost to deter people like a former neighbour who had as many as eight cars parked in the road (mostly untaxed). There is a chance that once every few years plod will manage to at least get him for some of them and clear the street a bit. Do away with the RFL altogether and he might have had twenty cars and nothing could be done about it.
Also with insurance the highest risks pay the most so there would be less incentive for some people to drive carefully. The standard of some driving is bad enough already.
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That's a good point Alan - what could be done to stop people owning but refusing to dispose of vehicles they don't use ?
A permit for each vehicle perhaps on a rising scale. Does that become just another form of road tax though ?
Any answers gratefully received !
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It should only be applied to people keeping cars on public land, imho. It would be unfair to apply it to people keeping cars on their own private property or locked up in garages eg restoration projects etc.
teabelly
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I wasn't being sarcastic. As I see it, major reforms in any part of driver and/or vehicle licensing and/or taxation are politically unsafe because of the amount of redundancies which would be caused.
Don't forget, these are not just departments doing an inefficient thing, they are also doing it in a massively inefficient way.
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? Do they actually "administer" VED at the moment ?
What happens if you do not tax a vehicle and do not declare SORN?
What happens if you declare a vehicle sold to a false identity?
What safeguards and checks do swansea actually operate?
What do they do with their time?
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Putting VED on fuel was mooted many years ago but turned down because it would push petrol up tp £2 a gallon (44p a litre) which was deemed politically unacceptable.
It's still a good idea though, as payment is proportional to road use, so long as the VED is actually got rid of (I don't trust the devils!).
VED exempt vehicles could either use gas oil or keep receipts and apply for a rebate.
IMHO third party insurance should be promptly paid out of public funds and recovered from the legally liable party (individual or insurance company). The present situation where it can take years to get damages and decades for payment to be received is obscene.
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I think the main reason we don't put the RFL on fuel is that Johnny Foreigner
does this so it must be a bad idea. Schemes put forward to put RFL on
fuel have included a 'nominal' £10 or so p.a. charge for 'registering' the
vehicle. How soon would it be before the 10 became 15 then 20 etc?
Before long we would be paying twice. I would like to see RFL on fuel with
no annual charge for registration. Insurance companies could provide a sticker
to show that the vehicle is insured. The annual check at the post
office only shows that the vehicle was insured at the time the RFL
was paid. Y would also welcome an additional charge on fuel to
compensate those injured in road accidents by idiots with no insurance.
And whilst I'm at it I would bring in draconian punishment for
those found driving with no insurance.
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"How soon would it be before the 10 became 15 then 20 etc? "
That's what I meant by "I don't trust the devils" in my post above.
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The problem is that although city dwellers would welcome it (because they drive the fewest miles), those living in the country wouldn't like it because they use and depend on their cars more.
Seemingly the poliiticians are loath to upset their country constituents ....
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Insurance companies could provide a sticker to show that the vehicle is insured.
The insurance companies have offered to fund such a scheme.
Instead the govt prefer to have 20 per cent of road users uninsured.
Why? They can't all be related to the previous Home Sec....
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These are my own opinions, and not necessarily those of all Toads.
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Many people forget or don't see the obvious flaw with this suggestion.
If VED was to be abolished and put on the price of fuel, either with ot without insurance, the DVLA records of ownership and driver's licensing still has to be funded.
A small fee would be charged by DVLA to administer these records since the Government would insist the scheme would be self financing.
The cost may start out at say £10 a year but would be increased from time to time. Before you know it, you'll be paying £100+ a year for this 'service.'
Abolition of VED is simply NOT a good idea and wont result in a reduction in motorist cost.
As regards to putting basic insurance costs on fuel I think the idea is unworkable. How are you going to prove you have paid the minimum equivalent of current 3rd party insurance? How are you going to determine the difference between your 3rd party cover and fully comp? Who will you be insured with should you need to claim and how are they going to prevent potential fraud?
Good idea intheory it may be. In practice I think it is awful.
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High milage drivers are mainly business users. I do 40,000 miles per year, around 4 times the average. I would not pay the extra if fuel prices rose to cover the abolition of Vehicle Excise Duty (No such thing as a Road Fund Licence). My customers would pay it because I would increase prices to recover the extra, plus a little bit more on top if I thought I could round up a little, which would be easy enough. As all businesses would do the same the General Public would end up footing the bill.
Can someone also explain what VED has to do with your annual milage? The money is not used to maintain the roads, it is absorbed into the general taxation revenue.
As for insurance, the three accidents a year in five thousand miles boy-racers would just love the rest of us subsidising their insurance. They'd be able to afford to buy even hotter hatches and have a few more prangs.
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Can someone also explain what VED has to do with your annual milage?
Tom
The idea attracts me because, in principle, I don't like paying standing charges for things - phone bills, electricity or driving my car. It would be wonderful if all my tax, fuel and inurance costs were directly proportional to how many miles I drive. That's not because I don't drive many miles - I do about 16,000 a year, not huge but above average I think. I just prefer the direct way of understanding the costs involved. However, I can't see any way it can be workable in practice.
I fully accept your point that businesses would pass on their increased cost to their customers, but what's wrong with that?
GJD
PS Very charitable of you to suggest that the three accidents a year in five thousand miles boy-racers bother to buy insurance.
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It would be fairer to combine both tax and insurance and produce one disc for display. Insurance company can probably do this more cost effectively than government offices. Advantage for authorities and in accidents that car can be seen to be insured. Only problem is that on taking car off road, insurance company will have to repay tax and collect back from DVLC.
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I agree with GJD, I hate paying standing charges on anything, I prefer to pay for what I use and when I use it. And, as a very low mileage road user, to have my tax at least (can see why insurance could not work) as part of my fuel bill would be hugely beneficial to me. I thought, maybe wrongly, that the justification for the VED was to maintain roads etc - and if that's the case then it seems to me that it would be fairer for it to be levied in proportion to how many miles one drives on the roads.
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HF
Just to play the Devil's advocate for a moment:
Take a zero starting point where there are no roads.
If you are paying for roads in with your fuel, you do not use fuel because there are no roads, and there are no roads because you do not use fuel.
So an up-front payment is required (VED) so a few feet of road can be laid, you then use some fuel and money is available to lay some more road.
And so on.
A neat argument, don't you think?
However, on a personal level I agree with you that no annual fee should be levied.
I also hold the view that if tax is being levied on a per mile basis, via fuel, as indeed it is now, then road tolls are totally unjustified.
And that the justification for congestion charging is also on shaky ground, since as traffic slows then the levy per mile increases in proportion to the decrease in miles per gallon (or litre).
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Brian, very good points - I take them all. Hypothetically you are absolutely correct with the point that the money had to come from somewhere in the first place. But that is surely historical? Surely now any money for new roads could be got from the people that will use those new roads?
At the risk of sounding ridiculous - and I know it will - a non-car driver does not have to pay road tax, because he/she does not drive on the roads. Logical. Personally, I do not use motorways or inner-city roads, (driving) because I don't like them. But I still pay the same in road tax, or more, as people who use these roads every day, and other roads, far more than I do. So,IF the tax is to maintain these roads, then surely it should be a pay-as-you-go system?
The road tolls and congestion charges are another matter, and surely if everything was done on a pay-per-mile basis, then there would be no need or justification for these.
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Forgive me if I missed something, but did the last government not introduce the escalater tax on fuel so that the Road fund licence could be done away with, starting with vehicles over 25 years old. Why should we leave our cars at home and walk/cycle when we have already paid up front, if the tax was put on fuel instead then the more you use your car the more you pay, and it would encourage more frequent servicing. I say this with tongue in cheek as we already pay the highest prices.
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I didnt know that the escalator tax was for some future scrapping of VED. If so then we've all been ripped off.
I know you speak T-I-C lezer, and I know our prices are ridiculously high, but why not have the 'more you use your car the more you pay' rule? We have it in most other things.
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"The more you use your car the more you pay" How would you feel if the same criteria was applied to health, education and council services?
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