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UK road tax evasion has trebled since paper disc was ditched

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UK car tax evasion trebles since paper disc was ditched

New government figures show that 1.8% of cars on the road are untaxed, amounting to £107 million lost revenue in the past year

The number of untaxed vehicles on Britain’s roads has trebled since the paper tax disc was ditched in October 2014.

New Department for Transport (DfT) figures show that 1.8% of vehicles are being driven without road tax.

That’s up from 1.4% in 2015, but more significantly, three times the level in 2013, which was the last full year to require the use of paper tax discs displayed on the inside of a car’s windscreen.

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It’s estimated that the unpaid tax from the past year alone amounts to £107 million in lost revenue. That figure is higher than in any year since 2007 and equates to approximately 1.7% of the total vehicle excise duty (VED) due.

The DfT said some of the lost revenue would have already been recovered by the Department for Vehicle Licensing Agency (DVLA), which can collect tax by enforcement or from late payments.

The removal of the paper tax disc, which was introduced in 1921, has been labelled as a key cause for the increase in untaxed cars.

Although the DVLA sends out letters and emails to motorists informing them of an approaching payment due date for their vehicle, the DfT said in its report that scrapping paper discs has removed an effective ‘visual reminder’.

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RAC public affairs manager Nicholas Lyes commented on the report’s findings, saying: “The principle of abolishing the tax disc to introduce greater efficiencies has, so far, evidently failed. More must be done to educate drivers about how and when to tax their vehicle, coupled with stronger enforcement to genuinely make drivers who evade vehicle tax feel that they are going to get caught.

“From 2020, VED receipts will also directly fund improvements to our strategic road network, so it is vital that every effort is made to make sure we tackle evasion so our road network does not lose out on essential investment.”

About 34% of untaxed vehicles on the road had changed owners since September 2016, suggesting buyers are forgetting to ensure their new car is taxed.

The DfT report said that about 70% of untaxed vehicles were being actively used on the road.

Vehicles exempt from road tax – such as those made before 1 January 1977 – do not need to pay VED but still need to be licensed for road use. The DfT figures showed that 1.5% of these vehicles were not licensed.

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