Telematic Technology to replace vehicle tax and fuel duty

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With the price of fuel hurtling towards £2 per litre, all of a sudden your Wetherspoons breakfast isn’t the most expensive part of your Saturday morning ride. And whilst it’s still utterly sickening, hearing how many billions of pounds profit the oil companies make every year, we’re still paying the government 57.95p in fuel duty (even after the recent 5p cut), as well as the 20% VAT, for every litre of petrol (or diesel) we use. It’s getting silly. And then of course there’s road tax which varies massively, from zero to hundreds of pounds a year, depending on what you ride (or drive).

We’re all paying Her Majesty’s Government handsomely for the privilege of driving on her roads, but some are paying a shed load more than others, and a few people are getting pretty pissed off about it.

If you’ve got an electric vehicle, you won’t pay road tax (or Vehicle Excise Duty to give it its official name). You also won’t have to pay the extortionate fuel duty at the pumps. That’s obviously one of the incentives of owning an electric vehicle; incentives of which there isn’t a very long list where electric bikes are concerned. Obviously, thanks to the price of household electricity skyrocketing, EV owners aren’t without their own issues at the moment.

The Big Issue

But the big issue, as far as the roads go, is this. There were more EVs sold in 2021 alone than there were in the five years before that, put together. And in ten years’ time, there are likely to be more EVs on the road than old fashioned, gas guzzling ones. At the moment, the government’s revenue from fuel duty and road tax is £35 billion a year. That’s 4% of all of the tax receipts in 2021. When internal combustion is banned, under the current fuel duty and road tax rules, that £35 billion will be a lot closer to zero. So unless the government are happy to lose £35 billion a year, they’re going to have to do something different.

The long and short of it is this, eventually drivers of electric vehicles are going to have to contribute, in one way or another, whether they like it or not. And I’m going to assume they’re not going to like it.

The Commons Transport Select Committee have suggested an alternative road charging mechanism; one that uses ‘Telematic Technology’ to charge drivers depending on how many miles they’ve driven. Presumably this would involve having a tracker in all of our vehicles, and I would hazard a guess they’d quickly come up with a way of charging you extra for breaking speed limits, but that’s another story altogether.

Revenue neutral

They’ve said that should the new tax system be implemented, it “must entirely replace the existing setup rather than being in addition to, and be revenue neutral”. I.e. nobody should pay more than they are doing now.

Clearly, some people will end up paying more i.e. electric vehicle owners. But it might mean that, if fuel duty wasn’t payable at the pump, as it is today, fuel prices could be a lot more tolerable. In the grand scheme of things, if all you do is ride on the road, it might not make much of a difference. But if you’re an avid trackday rider, or you ride off-road, you might find that you’re hobby is all of a sudden a little bit cheaper. Although I wouldn’t hold your breath.


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