Electric Vehicles Pay-Per-Mile

[AndyH]

The press are all reporting the pressure Rachel Reeves is being put under to introduce pay-per-mile for EVs to help fill the tax black hole caused by the phasing out of petrol and diesel cars.

Probably everyone on this site is fairly biased as to whether this should happen or not, but this has been on the agenda for some time and I haven't seen much discussion about it amongst drivers, any drivers not just those in EVs.

I have a stronger prejudice against this, being located in a small village in Norfolk. From my point of view, this is going to hit those who drive on the least congested roads more than those who commute in towns and cities.

We have virtually no public transport here, we do have a train station 5 miles away that no buses go, to and it is impossible to get a taxi at school arrival and departure times, as they are all being paid exorbitant rates by us the tax payers taking children to and from the local schools.

Hence, we have no choice but to use our cars. We can reach a supermarket in either 6 or 12 miles, which can only take 10 to 20 minutes, but that would be 12 or 24 miles pay-per-mile tax charge. A trip to the theatre would be a minimum of a 60 mile round trip, yet I could sit in my car all day in a large city as part of the congestion and not get taxed as much.

To add to the unfairness of this, it is well known that wages in rural areas are well below those in urban areas. And I thought Labour promised not to tax the working person.

Am I alone in feeling this is an unfair way of taxing motorists?

https://www.theguardian.com/politics/ar ... -transport

https://news.sky.com/story/chancellor-r ... s-13208793

https://www.telegraph.co.uk/business/20 ... -road-tax/

[AJP101]

how would they do it ?

mines a company car, would they charge for only personal miles? are business miles counted and charged to the driver or owner ?

they're already adding Tax on them from April about £365PA from what I can remember.

the government rebate for claiming business miles has dropped to £0.07 pm, so unless you're getting a really good rate your on a loss.

I don't personally think it will happen, there's no infostructure for it, the only way to track would be an annual MOT and someone checking the vehicle.

good old we'll enforce something but have no idea how we're going to do it

[kdwolf]

I have my personal view, but will be banned forever for expressing it...

From a technical point of view it is not an issue to enforce drivers to report on their milage periodically. It will take me no more than a week to write a relevant software and periodically report to the main system on every Reg. missing their submission date.

[Dav00]

In theory they can do it via MOT checks, prepaid/postpaid accounts linked to registration numbers, or telemetry+geolocation (the real enabler), or any variation of them. The usual suspects are pushing - at least in the long term - for the latter, as that would enable full dynamic road pricing, nudging, mass surveillance and so on.

I'm totally against for a number of reasons.
a) as a matter of principle, I'm against making public infrastructure pay-per-use. It's public infrastructure, it must collectively funded for a collective benefit which may well be unrelated to the individual use/benefit.
b) as a precedent. Before you accept that public infra becomes pay per use, check what is "public infrastructure" and what may come next
c) it will hurt more those that have fewer alternatives available, it can really becomes a matter of inequality across the country
d) it adds a burden affecting mobility, without even providing alternative options. We are uber taxed to drive a car, uber charged to to use rail infrastructure and services, uber charged to fly, uber taxed to ride a bike (if you consider the absurd cost of the infrastructure in the UK). And when you hit mobility, you affect freedom, social cohesion, social mobility, productivity, etc.
e) it can become high inflationary
f) it would become a fairly unusual pile-up of taxes on motoring: VAT on vehicles, excises and duties on vehicles, VED, VED surcharge, fuel tax on fuel, VAT on electricity, ancillary charges and taxes linked to the ecosystem - insurance, spare parts, breakdown insurance, occasional (...) tolls etc. Now even additional road pricing? How many precedents abroad?
g) It can hardly work in places where you drive abroad, unless you have telemetry+geolocation. Not accidentally the only two precedents regurarly quoted by the road-pricing advocates are Iceland and New Zealand. A), because there aren't many countries with such a crazy policy, b) because those (not so large) countries are not significantly interconnected to other countries. If you pay miles via MOT or account to fund roads in the UK, what happens when you drive in other countries? Do I get charged when driving abroad? I can see legal cases mounting.
h) it can trigger a ripple effect through the economy. Job roles based on mobility would be affected, logistics, etc.
i) on privacy and freedom grounds, if&when they go for telemetry and geolocation.
j) ...

For the record, I can tolerate a revised VED being turned into a sort of e-Vignette like in some other countries, with no discrimination between powertrains or stuff like that.

[Dorsetandy]

There is no “black hole” relating to the phasing out of ICE cars and the resulting reduction/loss of fuel duty. When this policy was announced there would have a full financial assessment provided by HM Treasury on the impact of these changes. So this has been known for some years - what the current and previous governments have chosen to do, or not do, is another matter! With relatively few incentives to purchase EVs here in UK the last thing needed are further disincentives to purchase one imo. Allegedly manufacturers are delaying delivery of petrol and hybrid cars to meet their 2024 EV targets and avoid hefty fines.

[Aragorn]

In theory they can do it via MOT checks, prepaid/postpaid accounts linked to registration numbers, or telemetry+geolocation (the real enabler), or any variation of them. The usual suspects are pushing - at least in the long term - for the latter, as that would enable full dynamic road pricing, nudging, mass surveillance and so on.

I'm totally against for a number of reasons.
a) as a matter of principle, I'm against making public infrastructure pay-per-use. It's public infrastructure, it must collectively funded for a collective benefit which may well be unrelated to the individual use/benefit.
b) as a precedent. Before you accept that public infra becomes pay per use, check what is "public infrastructure" and what may come next
c) it will hurt more those that have fewer alternatives available, it can really becomes a matter of inequality across the country
d) it adds a burden affecting mobility, without even providing alternative options. We are uber taxed to drive a car, uber charged to to use rail infrastructure and services, uber charged to fly, uber taxed to ride a bike (if you consider the absurd cost of the infrastructure in the UK). And when you hit mobility, you affect freedom, social cohesion, social mobility, productivity, etc.
e) it can become high inflationary
f) it would become a fairly unusual pile-up of taxes on motoring: VAT on vehicles, excises and duties on vehicles, VED, VED surcharge, fuel tax on fuel, VAT on electricity, ancillary charges and taxes linked to the ecosystem - insurance, spare parts, breakdown insurance, occasional (...) tolls etc. Now even additional road pricing? How many precedents abroad?
g) It can hardly work in places where you drive abroad, unless you have telemetry+geolocation. Not accidentally the only two precedents regurarly quoted by the road-pricing advocates are Iceland and New Zealand. A), because there aren't many countries with such a crazy policy, b) because those (not so large) countries are not significantly interconnected to other countries. If you pay miles via MOT or account to fund roads in the UK, what happens when you drive in other countries? Do I get charged when driving abroad? I can see legal cases mounting.
h) it can trigger a ripple effect through the economy. Job roles based on mobility would be affected, logistics, etc.
i) on privacy and freedom grounds, if&when they go for telemetry and geolocation.
j) ...

For the record, I can tolerate a revised VED being turned into a sort of e-Vignette like in some other countries, with no discrimination between powertrains or stuff like that.

a) Given the existing fuel duty on ICE cars, arent roads thus already pay-per-use? and infact, not only pay per use, but already conveniently graded such that higher mileage vehicles and heavier vehicles (which use more fuel) pay more to use the road. Its actually quite neat. Trying to replace this with something not based on fuel adds quite some challenge, not least of which you make the tax much more obvious. Most people are aware that fuel is heavily taxed. But if they got a bill at the end of the year for their fuel duty, instead of paying it per litre at the pump it would probably hit much harder...

b) this is predicated on the existing infrastructure not being pay-per-use, but i dont think thats true. A lot of public infrastructure we already pay to use. Think utilities like electricity/gas/water/postal service. There are other things which are covered by stuff like council tax which are based on slightly arbitrary figures like how big your house is, but also still likely correlates somewhat with usage.

c/d) the advantage of some sort of pay-per-use is that those who use it more, pay more. Should someone who drives 5 miles a week contribute the same as someone who drives 500? Or even someone who doesnt even drive at all? I guess theres some arguement that everyone gets use of the roads even if they dont drive themselves, they use a wide range of services which are provided by road.Its also fair to point out the revenue collected from fuel duty doesnt actually get ringfenced for roads in anyway.

f) it really needs properly thought out, if its going to work then it needs all of the existing multiple layers removed and simplified, i think implementing it well is clearly the biggest challenge here.

h) job roles are already based on mobility, as for the vast majority of people, they're driving a petrol car and paying fuel to drive to work. Longer commutes cost more, as someone driving 90+ miles a day i know all about that!

g/i) granted, how exactly they implement it is the big issue here. a more "smart" system with geolocation/tracking would be able to fix the issues around foreign trips for instance, but would ofcourse introduce privacy issues. A simple annual check based on MOT or whatever would be much simpler and wouldnt have the privacy issues, but would have others. Would also be much cheaper to implement a simple annual check.


Personally, i'm a high mileage driver and thus would very much prefer they didnt go along this route. But it could work, if implemented well. History shows implementing things well is often a real challenge.

[Bakerjoe]

While I benefit personally from the low charging costs of an EV, I can appreciate that it’s a difficult situation for government. We need to be moving away from fossil fuel-powered transport but doing so in the current system will result in lower tax receipts, yet taxing EVs more will hinder the transition. I agree that describing it as a black hole is misleading or sensationalist; it’s a fairly obvious, predictable problem with a less obvious solution.

I don’t have a particular issue with variable road pricing. Driving comes with numerous costs to society: safety, road maintenance, noise, climate change, air quality, congestion, etc. EVs perform better on some of these counts than ICE vehicles and you could reasonably expect a correspondingly lower rate of tax. Similarly, where, when and what you drive affects the level of those impacts/costs: driving a gas-guzzling diesel at rush hour in a city is more impactful than a small EV on a country lane at night; it doesn’t seem unreasonable to pay more to reflect that. Likewise, driving on quiet country roads has lower impact on some of those counts and would therefore cost less, mitigating the impact on people whose location leads to increased mileage.

What would be important, and which would make this much more palatable to the public, is that money raised is demonstrably put back into improving mobility in general. That’s not just improving the road network but also making it easier to walk, cycle, take the bus, train, etc. Many people are very happy to use public transport if it’s regular, reliable and inexpensive; you don’t need to park, can work/sleep/etc while travelling, maybe even ditch your car entirely. Then it’s a carrot and stick approach: tax the things that cost society more and incentivise the things that make us healthier, safer, etc. The same principle could be used to tax ICEs to subsidise EVs in order to speed up the transition and help those currently priced out of the market to access cheaper, greener mobility.

Without getting into the practicalities of actually implementing anything like this… With a suitable method, variable pricing could in theory allow cheaper rates for local residents, delivery drivers, etc, for example to discourage drivers using a town centre shortcut without disadvantaging those need that route for access.

[Aragorn]

Its also worth pointing out, this most recent round of media hype, which i suspect has been so amped up because its essentially "anti-EV", was pushed out by a "charity" which is essentially a lobbying group linked to bus and train operators...

https://bettertransport.org.uk/support- ... champions/

[ricky10]

I think PPM taxation is probably fairest way to tax car use.

But bringing it to a specific group of car is not fair. Everyone should be taxed under the same scheme, potentially any ICE variant cars have much higher £/mile due to pollution.

[Dav00]

a) Given the existing fuel duty on ICE cars, arent roads thus already pay-per-use?

Yes, it is to some extent, by stealth. However, it's a bit of a grey/complex area because historically there were multiple objectives related to the different taxes applied to fuel and electricity, not necessarily - if not at all - related to infrastructure funding.
In fact, soome of the taxes/tax increases have been marketed as a sort of carbon tax, rather than an infra contribution. Turns out technology solved the problem and we don't need the carbon tax any longer.

b) this is predicated on the existing infrastructure not being pay-per-use, but i dont think thats true. A lot of public infrastructure we already pay to use. Think utilities like electricity/gas/water/postal service. There are other things which are covered by stuff like council tax which are based on slightly arbitrary figures like how big your house is, but also still likely correlates somewhat with usage.

c/d) the advantage of some sort of pay-per-use is that those who use it more, pay more. Should someone who drives 5 miles a week contribute the same as someone who drives 500? Or even someone who doesnt even drive at all? I guess theres some arguement that everyone gets use of the roads even if they dont drive themselves, they use a wide range of services which are provided by road.Its also fair to point out the revenue collected from fuel duty doesnt actually get ringfenced for roads in anyway.

OK, this is different based on infrastructure and there are multiple topics to consider: funding mechanisms, contribution mechanisms, access, ownership etc.
Let's skip the private/privatised ones. In most cases, funding comes from general taxation at the national or local level, with some sort of flat contribution - if any. Then you may pay for the services being rendered through the infrastructure, but not always: e.g. with hospital, schools, you don't pay per night, per lesson, or whatever.
Example with electricity: we all contribute to investments of energy infrastructure via taxation, then consumers pay a flat standing charge for electricity transport (flat contribution), and then we pay per kWh the energy we consume (the service).

In the case of road, private car drivers don't even get a service rendered over it: you directly use the infrastructure. The service would be a bus/coach ride, to make an example.

All that said, let's go step by step
a) roads are funded via taxation
b) virtually none of the motoring-related taxes we pay are tied up to road funding, and no evidence, nothing even remotely suggesting that a pay-per-mile tax will be used exclusively for road infra, or transport and logistics infra, or simply public transport. It goes into the piggy bank of the Treasury and from there it goes everywhere, from nuclear deterrent to plasters in hospitals.
c) even if you tie it up to roads/transport, like most infra, there is no way you can sustainably fund it via usage only, not even in the long term. In most cases, you would need both high fees and high volumes, and you can find that only in a few pieces of infrastructure, probably concentrated in the South East and around/connecting large metropolitan areas. Apply that principle to the rest of the country and most of the residents would go nowhere - literally!
And this is just the beginning.
d) There is no black hole in the finances and not necessarily the response to a black hole must be an additional tax. There can be cuts and savings.
e) this whole idea has been pushed mostly by a few but effective anti-car campaigners, inventing a non-existent dichotomy between drivers and non-drivers and pushing to make driving inconvenient. Quite openly. Other lobbies and groups have joined the party, e.g. to raise additional revenue for specific purposes, to lobby against EVs and so on.
f) The alleged financial black hole is allegedly going to be in the region of £5bn/year. That's according to the latest articles, those reporting the position of RAC. There are 40+m registered vehicles in the UK, even a simple flat charge would be in the region of £120/£130 per vehicle per year. If you only need to raise that level of revenue, you have already got VED available, or you can set up simple e-vignettes or whatever. You don't need pay per mile, it's not even worth the hassle to set up the infrastructure to run it. There is a reason why precedents are close to zero and it's a topic completely undebated in most of the world.
g) if you take the principle that users (vehicles) of the infrastructure should fund it, a pay-per-mile scheme worth only £5bn would solve nothing compared to the whole cost of running the multi-billion road show.
h) if you justify on fairness ground, it's illogical.
First of all, it doesn't take into consideration who, why and where people drive more. Also, it doesn't factor in occupancy, road consumption, final beneficiaries of the journey and countless other factors. Want an example? Why should a nurse, driving to a patient, pay per mile?
Basically, a flat mile-based fee is deeply unequal albeit "simple", and any attempt to make it fair would be a nightmare of rules, means-testing etc.
Secondly, it's illogical because the actual road cost per vehicle mile is not the same, so it would be deeply unfair - and again it would defeat the purpose of ensuring fairness - to charge the same across all roads and across the country. Tie up mile fee to vehicle mile cost, and everything outside the busiest roads and motorways where the unit cost is low would be a financial bloodbath for the users.
i) As if the contradictions and problems aren't enough, I question morally and politically the whole point of paying by use or benefit or interest. If you follow that logic, why should anyone in the South East pay for a country road in Lanarkshire and the other way round? You use it, you pay for it, end to end. And once you apply the logic, why not extend it to other transport/logistics infrastructure? Why should people that don't use ports fund them? Why should people not travelling by train fund rail infra? Why should people not cycling pay for bike lanes? It's a terrible slippery slope.