The long road to ruin: Why the UK needs to reform motoring taxes

Current motoring taxes are unfair, unhealthy and fiscally unsustainable. How can we reform them?

Article

Motoring taxation in the UK has remained largely unchanged for almost a century, but rising consumer costs, a looming decline in tax revenues, and environmental and public health concerns make reform essential.

The current system of UK motor taxation is unfair, fiscally unsustainable, and – because it has done little to avert the negative public health effects of motoring – unhealthy.

While in the past politicians could be forgiven for shying away from addressing the inequities of the current system for fear of threatening a vital revenue stream for the state, technological advances mean that current revenue stream is now doomed to decline. Both politicians and stakeholders in motoring taxation should instead confront the current system's inequities as problems to be solved, and lead campaigns to make it more progressive. Steps to reform fuel duty and VED, and to create a progressive system based upon road usage, are urgently required. The government needs to start the difficult process of building a new relationship with motorists.

This report not only examines the failures of the current system and the measures needed to improve it, but considers the politics of motor taxation reform. It presents case studies, and original polling and qualitative research, to build a case for how public mandates can be built for reform that both addresses public concerns and solves public policy problems.

It provides:

  • an overview of research into motoring taxation reform in terms of its impacts on the cost of living, tax revenues and public health
  • UK and international case studies of how (and how not) to seek public approval for and implement motoring taxation reform at a local level
  • original polling and qualitative research into public attitudes towards motoring taxation and its policy implications.

Click here to download the complete results of the poll of public attitudes towards motoring taxation reform, conducted by YouGov for IPPR as part of this research in December 2013 (spreadsheet).

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