The Department for Transport (DfT) and the DVLA are considering the future of the tax disc amid pressure for its abolition from organisations including ACFO and the British Vehicle Rental and Leasing Association (BVRLA).
Late last year, the DfT published a consultation document focused on the reform of its four motoring services agencies – the DVLA, Driving Standards Agency, Vehicle and Operator Services Agency and the Vehicle Certification Agency.
In its vision of the future, the DfT said it would “consider the continuing need for the tax disc”.
In the 2013 Budget, the Government announced that it had “ruled out plans to make significant reforms to the structure of VED for cars and vans in the current Parliament”.
That means no decision will be made prior to the general election in May 2015.
However, a spokesman told Fleet News: “The DfT is still in the process of analysing responses to the consultation and will review issues relating to the tax disc in due course.”
Fleet News understands that the DVLA is in favour of scraping the tax disc, but that the DfT remains unconvinced.
‘Fraud costs hundreds of thousands of pounds a year’
Roddy Graham, commercial director at Leasedrive and chairman of the Institute of Car Fleet Management, has long called for fleets to be able to buy a three-year tax disc or for the whole system to be abolished with ‘lost’ revenue replaced by increasing fuel prices.
He said: “The tax disc system is an absolute nightmare for leasing companies in terms of sending out new road fund licences, discs getting lost, etc. It causes mayhem.
“Tax disc fraud costs hundreds of thousands of pounds a year. If the cost of a tax disc was switched to fuel, administration would be simplified and the issue of fraud would be taken away because those people that don’t buy a tax disc would have to buy fuel to drive a vehicle.”
ACFO director John Pryor, who has attended a number of meetings with the DVLA on tax disc issues, added: “DVLA has systems in place that identify the owner of a vehicle and whether or not it has been taxed.
“Additionally, Automatic Number Plate Recognition (ANPR) cameras are in operation across the country. Therefore, why is the DVLA continuing to send out bits of paper?”
Calls for the scrapping of the tax disc are mounting after Fleet News revealed how fleets face potential vehicle delays because some leasing companies are not delivering cars or vans without a tax disc, despite the introduction of a 14-day grace period.
New processes for the first registration and licensing of vehicles have been devised to compensate the closure of 39 DVLA regional offices, which concludes on December 13.
Jay Parmar, BVRLA legal and policy director, said: “The BVRLA is continuing to talk with the DVLA, DfT and HM Treasury, making the case for the tax disc to be abolished altogether.”
Meanwhile, there is growing concern among fleets about the DfT’s decision to abolish the paper counterpart of the driving licence, scheduled to take place in 2015.
It is also part of the DVLA’s modernisation programme that will see the introduction of a new online database, which companies and individuals will be able to access to check driver licence details (Fleet News, August 8).
But, with less than 14 months to the go, fleet operators, who watched a demonstration of the new Integrated Enquiries Platform (IEP) at a recent ACFO meeting, remain concerned on a number of fronts.
They include the go-live date, testing of the database with potential users, database security amid concerns that accessibility must only be for legitimate business reasons, the employee information required to access the system and whether access will be free or if charges will apply.
ACFO concerns over timescale for changes
ACFO chairman Damian James has doubts that the DVLA can deliver the required changes in the timescale available.
“In principle we like that fact that the counterpart is being done away with, but we need to be certain of the suitability of its replacement,” he said. “I cannot see how that can be delivered in 14 months.”
The sector likely to be hit worst by the abolishment of the paper counterpart is the rental business.
Car hire firms would no longer be able to give licences a quick check before agreeing to rent a car to corporate or retail customers.
With more than 10 million hire transactions every year, online or phone call licence checks to the DVLA for each one would add huge cost (and time) to the provision of hire cars with retail and fleet customers forced to foot the bill through higher rental charges.
Regional office closures
October 25, 2013
Aberdeen
Bournemouth
Brighton
Carlisle
Chelmsford
Edinburgh
Ipswich
Lincoln
Sheffield
Norwich
Oxford
Shrewsbury
Stockton
Swansea
November 22, 2013
Bangor
Beverley
Chester
Dundee
Exeter
Inverness
Maidstone
Peterborough
Sidcup
Theale
Truro
Worcester
December 13, 2013
Birmingham
Borehamwood
Bristol
Cardiff
Glasgow
Leeds
Manchester
Newcastle
Northampton
Nottingham
Portsmouth
Preston
Wimbledon
December 2014
Launch of the DVLA’s licence checking
Integrated Enquiries Platform (IEP)
January 2015
Paper counterpart
to be scrapped
Post-May 2015
VED scrapped?
Lynn Legg - 20/11/2013 11:05
This would suit me too-I can't afford to change my old car and have to pay around £120 tax for 6mths - but I use my car rarely, maybe only doing 20-25 miles in an average week!.Putting the lost revenue onto fuel would suit me fine-and if it stops tax disc fraud even better!