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Sat Nov 28, 2015, 08:13 AM

Ministers lose £80m in revenue after scrapping car tax discs


The Driver and Vehicle Licensing Agency (DVLA) ended the need for drivers to display a valid tax disc in October 2014, saying that the move would save the taxpayer £10m a year by making the system more efficient. However, that decision looks to have backfired, after official figures published on Thursday showed that the exchequer has lost as much as eight times the intended saving.

... The Department for Transport (DfT) estimated that about 560,000 vehicles were untaxed. Motoring organisations claimed when the measures were announced that the abolition of the tax disc after 93 years – part of the government’s purge on bureaucracy – would fail.

The move, which suffered a number of admin problems at the start, also led to thousands of innocent motorists having their cars clamped. Many of those who have not taxed their car may well have failed to receive official notices reminding them to get their tax renewed in the post. Under the old scheme, the tax disc provided a visual reminder when it was due. It was also easy for police to spot untaxed cars – something that it is no longer possible.


Oliver Morley, the DVLA’s chief executive, said: “Almost 99% of all vehicles on the road are correctly taxed: that’s around £6bn in vehicle tax passed to the Treasury every year. We write to every registered vehicle keeper in the UK to remind them when their tax is due, and we have introduced a range of measures to make vehicle tax easy to pay. At the same time, we are taking action against those who are determined to break the law.”


As far as I can recall, I set up a direct debit when the new system came in. Maybe I should check that I did, and that the payments have been going through. As it is, I'm reliant on DVLA's bureaucracy to keep me honest and avoid my car being pulled over or clamped or towed away.

I once met a guy whose company set up the previous online payment system, which was impressively efficient and seamless.

Also, if I sell my car to some sucker, or buy another one, I'll have to bear in mind:

While most motorists know that tax discs are no longer required, what is catching out many is that vehicle excise duty is automatically cancelled if a car changes ownership – even if there is a valid disc in the window.

Previously, anyone selling a used car could post adverts saying “Taxed and MOTd” until a certain date. But now when a car is sold the tax, even if it has many months to run, automatically expires and the new owner has to tax it again. It is this change that is exposing drivers to clamping by the DVLA and large fines.

The DVLA says it has worked with motor traders and written to new owners to make them aware of the change, but plenty of motorists have found their vehicles clamped or towed away after being given a taxed car by a relative, or even swapping cars within a family. Those who are caught out have no right of appeal to an independent body and say that the DVLA is acting unfairly.


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