Could road pricing be on the way in the UK?

Image of James Kelly
Author: | Updated: 07 Feb 2022 10:25

Road pricing could be on the way for UK motorists as early as 2024 according to the latest report from the Transport Select Committee.

The report, which has been presented to MPs, supports the introduction of a completely overhauled “road pricing” structure that could essentially replace fuel duty and VED (also known as road tax).

Road tax

It’s mainly down to the fact the government is set to lose out on as much as £35billion of tax in the coming years as the switch to electric vehicles takes hold. (EVs are currently exempt from road tax and no fuel means no fuel duty.)

The proposal to introduce a new scheme includes charging drivers a variable price per mile based on things such as time, location and the type of vehicle that’s being driven. The Select Committee says a road pricing scheme is one of the few ways to cover the shortfall in tax revenue.

It would also mean that cars would be tracked by fitting a GPS device. Devices would be registered to users and a telematics system would record location, times and routes. These variables would then be used to calculate the exact amount of tax you are charged.

A mobile phone app or a plug-in device in all vehicles could be used to allow this. Despite there being opposition to the plans, the Transport Select Committee highlights that for drivers, there could actually be benefits.

FairCharge UK

It states that any change in the way road tax is charged should be revenue neutral and “not cause drivers […] to pay more than they do currently”. They also state the system could be used to successfully reduce road traffic by as much as 50% by 2030 in areas that are currently heavily congested.

However, the plans go against the wishes of EV advocates such as FairCharge UK, that recommends drivers be incentivised for driving an electric vehicle – the proposed road pricing system pretty much does the opposite.

It remains to be seen if the proposed plans will be approved by MPs, but it’s likely chancellor Rishi Sunak will support the idea. We’ll bring you updates on potential road pricing as soon as we get more info.

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