Liberal Democrats would charge an average motorist an extra 700 quid a year to drive an ordinary car....

» Liberal Democrats would charge an average motorist an extra 700 quid a year to drive an ordinary car....

Liberal Democrats would charge an average motorist an extra 700 quid a year to drive an ordinary car....

Excerpt: ...and more than 1300 quid a year if you have a people carrier. Liberal Democrats only talk about charging people who drives "SUVs" and "Chelsea tractors".

Submitted by Peter Welch on 8 September 2006 - 12:57pm

...and more than 1300 quid a year if you have a people carrier.

Liberal Democrats only talk about charging people who drives "SUVs" and "Chelsea tractors".

What they don't say is that an ordinary Mondeo driver faces an extra cost of more than 50 quid a month.

They say they want to help working families. Well look out if you need to get three kids in the back of the car. They are going to make you pay.

They say that it will help fight global warming.But they know it will have no impact whatsoever.

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A bit rough and ready, but if I were drafting a leaflet for Labour next May (God forbid), I would try something along these lines.

Call me Cassandra, but I think wo far we have had entirely the wrong debate on tax. Overall the tax commission have done a great job. They are right to propose a top rate of 40%. They are right to propose more tax on environmental costs. Where they go wrong is in Figure 10.

The reason they have gone wrong is that they seem to have bought this table (which proposes that people who drive a Ford Mondeo would pay an extra 700 pounds a year) from the pressure groups. The Tax Commission paper acknowledges this. Read the footnote on page 27 and you will find that "research by the Energy Saving Trust" supports this. You will see too that MORI are supposed to have done work that wupports the proposal.

But read the EST literature and you find that these rates come from the good old fashioned pressure group tactic of asking for the sun to get the moon.

What MORI really found was that a tax increase of 150 pounds was sufficient for 55% of people to choose a smaller car.

Vince Cable had something to say about this sort of thing in 2003. He told the ODI that

there is now a quite dense network of non-governmental and campaigning organisations, much of whose work is excellent proselytising and professional work, but who have acquired a status in filling in the gaps in our lack of knowledge. They have been very influential in areas like this and often, I think, steering us in horribly wrong directions.

This seems to me to be just such an example. And clearly this view is widely shared because two of the other policy motions call for cuts in Vehicle Excise Duties in rural areas (F42 Rural Communities and F43 Social Exclusion).

What should we do? Some way whould be found to withdraw Figure 10 from the Tax Commission paper. We should think further about VED. Perhaps we should charge people who drive enormous vehicles large amounts - possibly the 2000 pounds we talk about. But Figure 10 does not give the figures we should use for average family cars nor for MPVs.

The answer should be a three-pronged approach: increases in VED of around 150 per band except for the highest (where we could stick with an increase of 500 pounds; increases in fuel duties; and more road pricing in urban areas where congestion is a problem.

The broad lines of the tax commission paper are fine. Let's lose this useless set of figures.