A different kind of charge
Will we see road tolling from the new government, asks Paul Hollick, chair of the Association of Fleet Professionals
What’s the state of play for road tolling following the election of the new government? That question is something that we’ve been pondering recently at the Association of Fleet Professionals (AFP).
The AFP Tax and Regulation Manifesto, launched recently, clearly states our position: “The AFP expects road tolling to be introduced at some point during this decade. This will have a direct and substantial impact on the operation of company vehicles of all kinds. We would like the Government to be open about its plans in this area, with the creation of a transparent dialogue that allows a form of road tolling to be discussed and ultimately adopted that both fulfils the needs of the Treasury and is simple and easy for fleets to use.”
It's a statement that assumes widespread acceptance of the likelihood of road tolling. However, it’s worth noting that the most high-profile recent appearances of the subject was during the London Mayoral elections, when supposed plans for its introduction were used to attack Sadiq Khan, and then the general election, when some Conservative leaflets used it very much as a negative by insisting Labour were going to tax people on every mile they drove. There’s a depressing argument that it now falls into the category of ‘culture wars’ issues.
If road tolling is among Labour’s plans, the party is keeping it pretty quiet. Obviously, its election campaign was characterised by a don’t-rock-the-boat approach and the party's actual intentions will become more apparent over the coming months, but there’s no obvious signs of any enthusiasm for the idea, or even to start discussions about how it might work.
This is probably understandable. Personal car use has become something of a political flashpoint. Most politicians will look at the extremely vocal opposition that has surrounded the introduction of the ULEZ in London or the 20mph speed limits in Wales and grimace, despite initial evidence that the former is improving air quality and the latter is having a measurable impact on the number of collisions. Talk of an ongoing ‘war on motorists’ is something most ministers would be very keen to avoid.
Of course, this doesn’t change the fundamental argument for road tolling, that paying on use is a fairer system than the patchwork of fuel, road and local taxes and tolls that we currently have in place – and that the technology is now available to make this kind of charging relatively easy. Certainly, our impression is that there is quite widespread support for the idea in the fleet community but one of the lessons of the election campaign is that if an idea doesn’t float in marginal seats, it is probably doomed, especially for a government that has got its eyes on at least two terms. The AFP expectation that it may happen in the next decade could prove to be misplaced.
However, if realpolitik means we aren’t going to see road tolling, there are other ideas in the AFP Tax and Regulation Manifesto that could be introduced without much political risk and could deliver benefits for businesses. Here are just three.
Firstly, limit the cost of parking at railway stations, something that we believe is having a very real impact on the adoption of more road-rail connected journeys. If it costs more to park than to keep driving to your destination, you’re likely to stay in the car. Cheaper parking equals more train use.
Another is Benefit-in-Kind company car tables that run until 2030. It is now nearly two years since the current tables were announced and they only run until the 2027/28 tax year, meaning some fleets buying vehicles today don’t know the tax rate their drivers will be charged towards the end of the decade on cars being bought today. This is something that could be resolved easily.
Finally, introduce tax-free allowances for mobility payments to employees as an alternative to a company car. Set a budget and allow each individual to make their own arrangements for travel. This is currently done in France with an allowance of €600 a year. We would like to see a UK allowance of £2,000 based on the mode of transport to promote mobility.
If some of the bigger ideas that affect fleets such as road charging are politically difficult for the government, other measures aren’t. We’d very much hope that a new administration, which has won votes for its accent on competence and decisive action, could implement easy wins such as relatively quickly.
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Talk of an ongoing ‘war on motorists’ is something most ministers would be very keen to avoid
