Car tax evasion hits a record high seven years after paper discs were axed: One in 50 vehicles have no VED – costing the UK £119m a year
Vehicles being used on UK roads without tax reached a record high this year, with evasion levels now three times higher than before paper discs were scrapped seven years ago.
Some 1.9 per cent of cars, vans, trucks and other motors on Britain’s roads are evading Vehicle Excise Duty – representing almost 750,000 vehicles – new figures out today confirm.
The number of untaxed vehicles in the UK has risen from 1.6 per cent in 2019 and is significantly higher than the 0.6 per cent non-compliance level in 2013 – the last full year before paper discs were abolished in a bid to save the DVLA millions of pounds every year.
The move has clearly had the opposite effect, with the Treasury now missing out on £119million in lost revenue from unpaid vehicle tax each year.
Dodgers: Car tax evasion rates have more than tripled since the paper disc was abolished by the government in 2014, new Department for Transport stats show
In 2013, the final year motorists had to display a valid paper tax disc, approximately 210,000 motors on the road were believed to be untaxed.
That’s less than a third of the number of vehicles being driven with unpaid VED today, with almost one in 50 vehicles – approximately 745,000 – on the road without taxed, official figures from the Department for Transport confirmed in its latest bi-annual report.
That also takes into consideration that estimates for motorcycles have – for the first time – been left out of the DfT’s report due to ‘insufficient sample size’, though it caveats that the impact is ‘very small’ on overall compliance rates.
When the paper disc was ended in October 2014, the Government said it would eventually save the DVLA around £7million annually.
However, the increase in evasion since the car tax system was moved online has hammered the Treasury’s pockets. And the higher level of evasion comes despite widespread use of ANPR cameras.
Some of the earnings through car tax also go towards improving roads in the UK, which means drivers are losing out too.
This DfT chart shows the higher level of vehicle tax evasion since the paper disc was axed in favour of the current only system in 2014
When paper discs was scrapped in October 2014, the government said it would save the DVLA around £7m annually. Instead it is costing the Treasury £119m a year in lost revenue
Commenting on the figures, RAC head of roads policy Nicholas Lyes said: ‘It’s hugely concerning that we’re seeing ever greater numbers of unlicensed vehicles on the roads with the total number now standing at nearly three-quarters of a million.
‘While we’d like to think the abolition of the paper tax disc back in 2014 isn’t responsible, the fact remains evasion has increased significantly since then to the point where a shocking two in every 100 vehicles on the road aren’t taxed.
‘The cost from VED evasion in 2021 alone is set to be a whopping £119million, a substantial sum that should be spent on improving our road network.
‘We urge the DVLA to step up enforcement and to do all it can to bring evasion down, as it is clearly not fair on those who do pay their fair share to drive on the road.’
The AA says the higher levels of tax evasion could be linked to the rise in the number of vehicles granted a Statutory Off Road Notification (SORN) status during the various Covid-19 lockdowns, with some 260,000 cars officially declared off the road last December.
‘Some of those vehicles will have been put back on the road with the owners either mistakenly or deliberately forgetting to tell the DVLA,’ says Jack Cousens, the motoring group’s spokesman.
He added: ‘High inflation, particularly with pump prices that refuse to drop despite big falls in the wholesale cost, always pressure many low-income drivers to run the gauntlet and not pay their tax.
‘It is foolish for them to chance their arms because the penalties are severe, even potentially having the car crushed.’
In the final year motorists had to display a valid paper tax disc – 2013 – approximately just 210,000 motors on the road were believed to be untaxed. Now it’s around 750,000
Regional analysis showed that the highest rate of VED evasion is in Northern Ireland, at 2.7%, followed by Scotland with 2.1% of motors untaxed
The vast majority (55%) of all motors without tax have not had it for up to 2 months. However, 13% of untaxed cars have not had VED paid by their owners for over a year
Closer inspection of DfT figures showed that evasion rates for private and light good vehicles – passenger cars and vans – was higher than any other vehicle type, at 1.9 per cent.
Regional analysis showed that the highest rate of VED evasion is in Northern Ireland, at 2.7 per cent.
This is followed by Scotland (2.1 per cent) where evasion rates are higher than average, while some 1.5 per cent of vehicles in England and Wales were identified as not being taxed.
More than half (55 per cent) of vehicles showing as not having tax have been unlicensed for less than two months, government records show.
Incredibly, more than one in 10 (13 per cent) had been unlicensed for more than a year.
In terms of age, those vehicles most commonly untaxed are older than 10 years (38 per cent), while 9 per cent were new models less than two years old.
Any motorist caught driving without valid vehicle excise duty can be fined up to £1,000.