The RAC says its fears about loss of revenue following the abolition of the paper tax disc have proved well founded following the publication of the Driver and Vehicle Licensing Agency’s (DVLA) annual report.
The DVLA’s newly published annual report and accounts show revenue from vehicle excise duty has fallen by £93m in the year following the abolition of the paper tax disc – from £6.023bn at the end of March 2015 to £5.930bn a year later.
The RAC says the loss in even greater than the Government’s own estimate of £80m over the course of 2015.
While the RAC acknowledges there may be other factors affecting the DVLA’s revenue loss – including ‘cheaper to tax’ low carbon emission vehicles – it is concerned the figure may continue to rise in the coming years as a result of increased evasion.
Simon Williams, RAC spokesman, said: “It is worrying that the reduction in revenue from vehicle tax has exceeded the Government’s own estimate – and far exceeds the £10m savings arising from no longer issuing tax discs. This loss is a significant sum and one that merits further investigation.
“We urge the DfT to carry out another roadside survey of unlicensed vehicles this year to fully assess the untaxed vehicle situation.
“We hope that this doesn’t prove to be the tip of the iceberg and that the figure does not keep on rising.”
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