Freeloading, Tax Dodging Cyclists!
Over on IPayRoadTax.com , one of the comments raises an interesting philosophical point to justify why drivers of cars have a greater moral right to use the roads than people riding bikes:
"How much extra tax do you think you would have to pay if cars didn’t exist?"
This got me thinking, so I did some digging.
Per household in the UK, taxes paid by motorists would work out at about £2,200 in "extra" tax. But as most households already have cars, it would just mean paying the tax via a different route. So the net change would be zero.
But here’s the thing - motorists’ taxation has been slewed in recent years to address CO2 emissions - 77% of what you spend as a motorist is either tied directly to how many miles you drive, or the CO2 emissions efficiency of your vehicle. If there were none of these taxes in place, would the number of miles driven and the subsequent CO2 emissions go up or down?
Let’s put that aside though, and consider the benefits that we get from all that tax taken so unfairly from motorists. I’m keen on the public services I receive in this country, but like all hypocrites, not so keen on paying tax. Seeing as I don’t like prison food though, tax evasion isn’t really an option, so if I’m to reduce my tax bill have to opt for tax avoidance instead (figures below assume all vehicles are private cars):
- VED - a.k.a. "road tax" £5.4bn, or £245 per household. You can reduce this to zero when you next change your car, simply by opting for one that has low CO2 emissions. One with less than 120g CO2 / km is rated at £0 for VED. There’s a list of cars in this category on WhatGreenCar.com.
- Fuel Duty £24.9bn, or £1132 per household. Fo ur ways to reduce this: 1) Make fewer journeys - like it said in the WW2 poster, "Is Your Journey Really Necessary?" Let’s assume that you’re a Busy and Important Person, and can only cut 10% of your journeys - £113. 2) Drive more like your grandmother and less like a hooligan - you can save ~25% (£282 per household) at a stroke! 3) Convert your short trips to walking or cycling . More than 70% of all UK trips by car are less than 6 miles - do just half of these by bike, and you can cut £396 from your tax bill. 4) Get a more efficient car when you next change. Average UK cars do just 38mpg (combined) (n.b. US Gal = 0.83 Imp Gal, so in US terms, this is 32pmg), but it’s now pretty easy to get a car that’s 25% better than this, saving £282 a year. If you did all four, you could cut this tax from £1132 to £401 - a saving of 65%!
- Toll Bridges, Tunnels & Roads £0.3bn or £14 per household. Two words: Avoid them.
- London Congestion Charge £0.3bn or another £14 per household. [sarcasm]This is totally unavoidable, because there’s no decent public transport system in London, and the distances traveled are just too vast for either walking or cycling[/sarcasm]. Oh, and if your drive a low-emission vehicle, you’ll soon be exempt from the charge anyway. And besides, this tax only applies to people driving in a few square miles of London - the other 95% of the population don’t need to pay it at all.
- VAT on fuel £6.8bn or £309 per household. Cut this by 65% to £110 by the same methods used for Fuel Duty.
- VAT on vehicle sales £6.9bn or £313 per household. Just buy a smaller, more efficient car. And seeing as you’ll be driving less, it’ll last you half as long again, so you could reasonably cut this by 50% to £160 p/a.
- Insurance Premium Tax £1bn or £45 per household. This is levied at 17.5% of the vehicle’s insurance charge. So the easiest way to reduce this is when you change your vehicle to select one that’s in a lower insurance band - let’s assume that on average, you could cut this to £35 per household.
- Company Car Tax & Fuel Benefit Charge £2.5bn or £114 per household. I have no idea what this is - something to do with offsetting the benefit in kind you get from driving a company car? Let’s assume that we can’t reduce this at all.
So, from an initial tax of £2,200, it’s possible to cut your spend down to £834 - saving 62%. For the country as a whole, this would be £29.9bn
I’m just grateful that most motorists are too slow-witted to do these things - without their £29.9bn, I dread to think what sort of a state the economy would be in if we had to rely on freeloading, tax dodging cyclists to make up the shortfall.