Emissions experts call for car taxation to be based on weight and mileage
21 November 2024
Cars should be taxed on a combination of weight and mileage, according to a new study from emissions experts Felix Leach and Nick Molden who propose a simpler car tax system that would apply the ‘polluter pays’ principle.
Leach, who is an Associate Professor of Engineering Science at the University of Oxford, and Molden, the CEO of emissions testing company Emissions Analytics, will be launching their new book: Critical Mass: The One Thing You Need to Know About Green Cars at Keble College, Oxford, on November 25th and Imperial College, London, on December 2nd. The events will outline proposals for a simpler, more environmentally-credible road tax system.
The launch of the book will be hosted by Chief Executive of the RAC Foundation and former Director General for the UK Department of Transport, Steve Gooding, and Professor Gautam Kalghatgi, until recently Visiting Professor at the University of Oxford.
The book outlines that the current British system for Vehicle Excise Duty (VED) is flawed, calling it a ‘mishmash of incentives and penalties,’ and provides evidence-based analysis that has the basis to overcome the factional disputes between different groups trying to promote one powertrain over another. Next year the so called ‘road tax’ will undergo a major overhaul and it will include electric vehicles (EV) that are currently exempt from VED.
Starting April 1st, 2025, EVs will lose their VED exemption. That means buyers of new EVs will have to pay the next lowest first-year tax rate, which currently stands at £10. Once an EV hits its second year on the road, owners will be required to pay the standard VED rate, which is currently £190 and is expected to increase with inflation from April 2025.
The new legislation will also hit buyers of EVs costing over £40k with additional tax and used EV buyers and hybrid buyers will also have to pay more.
But the book authors show that as a single metric, vehicle mass is the best surrogate for a vehicle’s environmental impact. They then propose a mass-distance based taxation system to replace gas tax as we move to an increasingly diversified powertrain world.
Molden explained: “In our book, we offer an intuitive ‘proof’ of why mass and distance are fundamental to designing a system to incentivize the purchase of ever-greener cars and this is contrasted with other flawed bases for judging environmental impact, such as measures of vehicle efficiency, including energy and fuel efficiency, as well as elements incorporated in the current system such as fuel type and laboratory carbon dioxide emissions.”
The two experts outline ways in which the system can be adopted and show the types of cars likely to taxed lightly and those that will be more expensive to keep on the road. Broadly, smaller cars will be cheaper to tax.
Under the proposed system—taking the example of the UK—if an average car is 150 kg lighter or does 1,000 fewer miles, the owner would pay £100 less per year. The book proposes specific tax rates and compares them to the existing taxes to illustrate winners and losers—winners being small city cars and loser including high-mileage heavy cars and SUVs.
Source: Felix Leach & Nick Molden