New Car Tax Rules..... Scam?

AdrianC

And let's not forget that, back when this first came out last October, the figure was that 2/3 of all used vehicle keeper changes involved previously untaxed vehicles - so there was no change in revenue.

I very much doubt that the tax system CAN cope with greater accuracy - it's never previously required day-count accuracy, only month-count, so it would require heavy redevelopment. And then why have the tax expiring at the end of the month? Why not do it to the 23rd, say?

No, there's no redevelopment going to happen until a Gov't bits the bullet and addresses sharply falling revenues from newer-to-middle-aged vehicles in some way which won't massively penalise older vehicles. A total overhaul is inevitable.

Legocar

If 2/3 don't count then that means 1/3 do....

Annual used car sales in the UK are around the 7,000,000 units mark so by my rough estimation this will net the government over £20 million a year in extra revenue....

Every little helps indeed!

motorguy

Legocar wrote: »

If 2/3 don't count then that means 1/3 do....

Annual used car sales in the UK are around the 7,000,000 units mark so by my rough estimation this will net the government over £20 million a year in extra revenue....

Every little helps indeed!

You're missing the point.

The government calculates what tax revenue it needs to bring in, and then applies the rules / rates to make that happen. If one of those rules is to allow people to tax cars only in monthly units, then thats one of those rules.

If they didnt get that extra (for talks sake) £20 million when people change their car, they'd simply increase all the rates to cover it.

If an average tax is £120 a year, then someone is "out" a tenner max if they change their car at the start of a month.

If its really an issue for you - and it seems to be - then there are various ways to mitigate it :-

• Dont change your car
• Change your car on the last day of the month
• Drive a car with a miniscule or £0 tax rate (mines £30 for the year)

Simples.

marlot

At the same time, as the new scheme came into effect, the government reduced the additional premium for buying 6 months tax from 10% to 5%. I don't hear so many people moaning about that!

I don't see how they could have done the system other than how they've done it, unless they changed to tax by the day - and I doubt the DVLA back office systems are up to that!

arcon5

motorguy wrote: »

You're missing the point.

The government calculates what tax revenue it needs to bring in, and then applies the rules / rates to make that happen. If one of those rules is to allow people to tax cars only in monthly units, then thats one of those rules.

If they didnt get that extra (for talks sake) £20 million when people change their car, they'd simply increase all the rates to cover it.

If an average tax is £120 a year, then someone is "out" a tenner max if they change their car at the start of a month.

If its really an issue for you - and it seems to be - then there are various ways to mitigate it :-

• Dont change your car
• Change your car on the last day of the month
• Drive a car with a miniscule or £0 tax rate (mines £30 for the year)

Simples.

At least by incorporating it in to the cost then they are raising the money in an honest way and not using a cunning technique that sees them targeting people buying or selling cars.

arcon5

Car_54 wrote: »

First, I believe the average VED is now less than £100. So the average "loss" of half a month's tax is about £4. Hardly worth all this excitement.

Second, every £4 collected by this alleged "scam" is £4 less to be collected in income tax etc. No-one is profiting.

I wonder what the average actually is...

facade

It would have been simple enough, the refund is from the first day of the next calendar month, as it is now, and the tax liability starts on the first day of the next month too. (If it were already taxed that is)

SailorSam

Perhaps not a scam but certainly a Tory stealth tax.

BeenThroughItAll

SailorSam wrote: »

Perhaps not a scam but certainly a Tory stealth tax.

Wondered how long it'd be before political loyalties appeared. After all, the last government left our national finances in such a perfect state, didn't they!

Joe_Horner

marlot wrote: »

I don't see how they could have done the system other than how they've done it, unless they changed to tax by the day - and I doubt the DVLA back office systems are up to that!

Very easily as it happens.

All they would need to do is have the car remain taxed for the (non-refunded) remaining part of the month. Since there are now no disks involved (the whole point of the exercise) that would be very easy indeed:

(1) You sell a car on, say, 10th of April.

(2) The tax is already paid for April but you won't get that refunded.

(3) So that remaining 20 days stays in force and the new owner has to tax it from the 1st May.

Problem solved.

As for the "they'd only have to raise it elsewhere" argument - that might have some validity if there was a commensurate reduction in other taxes (apart from those for the really rather rich).

But, even with that, it's an entirely regressive tax because it affects those least able to pay (who tend to drive older cars in higher tax groups because that's what they can afford but they may well need the transport) far more than it does those who can afford it because they can also afford the latest zero emission cars (as Motorguy blithely suggests) if they don't want to.

Frankly "just get a zero or low tax car" is a little insulting to the many people round here who work full time on NMW (often for big companies who're coining it in on the back of their labour), need cars because public transport is non-existent and all the jobs and even shops (unless you want to buy tourist windmills for the beach) are 20+ miles away, and can just about scrub together £500 for the next old banger when this one goes tits-up.

These are honest, very hard working, people doing their best to not be a drain on society but society seems to discount the fact that they even exist when doing this sort of thing.