Can you defend VED?

London_Falcon

Rick Chasey wrote:

That's just idiotic.

Nicely reasoned.

Although I know I shouldn't take the bait....

VED is charged at different rates for different size car engines so that bigger cars pay more, as a so-called envirnomental measure.

But owning a bigger sized car isn't the problem, it's driving it that causes pollution, via high fuel usage.

If you are serious about using a tax measure to reduce emissions from cars then put the tax on fuel, not on the car themselves.

If, on the other hand, you want to put a punitive tax on owning big cars as a wealth re-distribution measure then fair enough. Just stop pretending it "for the environment", as it's clearly not. [\rant]

daviesee

Looking like a nicely warmed up debate :twisted:

Unfortunately, I am finishing work so will have better things to do........

Carry on chaps!

rick_chasey

London_Falcon wrote:

Rick Chasey wrote:

That's just idiotic.

Nicely reasoned.

Although I know I shouldn't take the bait....

VED is charged at different rates for different size car engines so that bigger cars pay more, as a so-called envirnomental measure.

But owning a bigger sized car isn't the problem, it's driving it that causes pollution, via high fuel usage.

If you are serious about using a tax measure to reduce emissions from cars then put the tax on fuel, not on the car themselves.

If, on the other hand, you want to put a punitive tax on owning big cars as a wealth re-distribution measure then fair enough. Just stop pretending it "for the environment", as it's clearly not. [\rant]

Look. Petrol is involved in the vast majority of economic chains. It's not just about people travelling around in a car to see their gran. It's lorries, transportation of good, people travelling places for work, to go to work etc etc.

Pricing out people of something that is by and large an economic necessity is madness.

For sure, tax unnecessarily greedy cars, or cars that put excessive strain on infrastructure.

But raising petrol so high you price most people out? You might as well whack another 8% on inflation and watch general output nosedive.

davis

London_Falcon wrote:

But owning a bigger sized car isn't the problem, it's driving it that causes pollution, via high fuel usage.

+1

rolf_f

rjsterry wrote:

You've not really understood this capitalism lark have you

Sadly not. One day I'll probably buy a car that post dates the 1980s but I hope it won't be necessary.

London_Falcon

Look. Define "economic necessity". Waffly nonsense. :twisted: :twisted: :twisted:

rick_chasey

London_Falcon wrote:

Look. Define "economic necessity". Waffly nonsense. :twisted: :twisted: :twisted:

So why when every inflation report is issued it specifically always mentions fuel costs?

Since fuel is a cost in so many parts of the economic chain.

Google "inflation" and "petrol" and see what comes up.

A good case in point: http://www.guardian.co.uk/business/2012 ... w-round-qe

Falling petrol prices on Britain's forecourts pushed inflation to its lowest level in two and a half years last month, opening the way for the Bank of England to take fresh action to stimulate the economy.

woodnut

I propose fuel rationing :twisted:

London_Falcon

woodnut wrote:

I propose fuel rationing :twisted:

That would work just fine, as long as there was an open market to buy and sell your ration. Then people who really need more fuel could buy additional allowances.

Rick - just because something is in the CPI basket doesn't mean it is an "economic necessity" any more than "restuarants and cafes", another CPI basket constituent.

To be fair, and because I am off to ride my bike home in a minute, I don't really think that the tax on fuel should double or triple as the social impact would be too high. BUT I do wish successive governments wouldn't use the economy as an excuse for re-distributive taxes. And VED has nothing to do with reducing pollution.

woodnut

London_Falcon wrote:

woodnut wrote:

I propose fuel rationing :twisted:

That would work just fine, as long as there was an open market to buy and sell your ration. Then people who really need more fuel could buy additional allowances.

Rick - just because something is in the CPI basket doesn't mean it is an "economic necessity" any more than "restuarants and cafes", another CPI basket constituent.

To be fair, and because I am off to ride my bike home in a minute, I don't really think that the tax on fuel should double or triple as the social impact would be too high. BUT I do wish successive governments wouldn't use the economy as an excuse for re-distributive taxes. And VED has nothing to do with reducing pollution.

But that's not real rationing. With real rationing people who NEED more would of course have a bigger allowance. Mrs Creditworthy taking Jemima to school in the Evoque wouldn't.
So she'd have to walk, lazy cow.
Of course, this is akin to Socialism and we all know there is no alternative to the Free Market...

Wrath Rob

I think some of you have the wrong end of the stick. The government state that their aim with VED and reduced rate for less polluting cars is to encourage a change in behaviour. I think that's a load of BS. I think the actual aim is to try and strike a balance between what tax they can charge and people will pay vs a punitive tax that people will stop paying by changing behaviour.

For example, if everyone ditched their current high VED cars and bought low ones instead, the government would loose a significant amount in fuel duty. Instead they try and get the balance right so that they get tax from both.

Another example is smoking. Every single year the tax has gone up on cigarettes above the rate of inflation to encourage people to stop smoking. The result? No real change in smoking habits (women under 25 has actually increased) but loads and loads of extra revenue for the government. If they really wanted to stop smoking they'd up the tax by more than a few pence every year.

FWIW, I support increasing the tax on petrol and abolishing VED. That way you pay for what you use. Want a status symbol car that you (or the wife on the school run) uses lots? Pay for it.

nation

I do think there's a rational for taxing fuel for private use differently from fuel used by, say, hauliers and delivery companies, similar to the way the agricultural sector gets to use red diesel.

Would be a nightmare to administrate, though.

Really what's needed is some other infrastructure over which logistics chains can be run more efficiently than driving everything the length and breadth of the country by truck. Something like that rail network that's suffered from chronic underinvestment for decades....

(In case anyone wants to start a fight, I am not arguing that all goods currently moved by road could be moved by rail instead, that's obviously ridiculous. I do think that if there was more capacity and the price was brought down, a significant chunk of stuff currently moved by road could be moved around by rail between freight terminals, with trucks for the "last mile")

davmaggs

The government needs/wants revenue. They'd be very reluctant to give up on VED as vehicles are one of the easier items to place a levy on (have to registered, insured etc), and it means that they can split the taxed population up into many groups so that they don't end up with one unified opposition.

Put all the tax on fuel and you no longer have multiple tax bands that can be played around with, you merge the public with industry, you appear to merge Bentley owners with school mums, and you remove the illusion that VED bands reward/punish behaviours. A pure fuel tax would in other words very very visible and each time HMG wanted more cash it would be very obvious.

tailwindhome

Rick Chasey wrote:

That's just idiotic.

Free and easy with the old name calling rule there. Eh Rick?


[/Friday]

rick_chasey

TailWindHome wrote:

Rick Chasey wrote:

That's just idiotic.

Free and easy with the old name calling rule there. Eh Rick?


[/Friday]

I think the pronoun you're looking for to make the point there is "you". As in, "you are idiotic".

Unfortunately, that's not there in the quote :P.

Naturally, the pronoun 'that' used is in reference to the topic discussed, rather than the person discussing it.

I give your mod bating 3/10.. All three points for getting the rise. None for being right .

rick_chasey

Genuinely, high petrol prices mean high prices across the board, which isn't ideal.

phy2sll2

jds_1981 wrote:

Receipts from motoring taxes total £38.5 billion a year, equivalent to 7% of all Treasury income, with the Office for Budget responsibility putting income from VED at £5.8 billion a year.

Anyone know how much tax on petrol would need to go up to be equivalent?

Well, 492 Bn vehicle kilometres travelled last year. That's across all vehicle types though.

Make an assumption about fuel efficiency. I don't know much about cars, having never owned one, but say 20 MpG =14.1 l/100kms

4.9x10^14m * 14.1 l / 1.0x10^5m = 69.4 Bn litres of fuel

£5.8 Bn / 69.4 Bn litres = 8.4p a litre.

Not as much as I thought.

jds_1981

Rick Chasey wrote:

Genuinely, high petrol prices mean high prices across the board, which isn't ideal.

It contributes - I don't think we should try to influence travel choice through high taxation - 'the whip' as it were.

bompington

CBA to google the news stories, but it was in the news a few weeks back that the government are getting worried about the drop in VED they're getting - because people are moving to lower-band cars (I've had a zero-rated Kia for 6 months now).
Also, I was talking to one of Dundee's main road engineers the other night, who said (among other interesting things) that traffic volumes have dropped significantly since 2007. Now Dundee's economy has never really been buoyant, but it has probably fallen less than other cities in the last 5 years.
So people are driving less, in lower-taxed cars: fuel clearly doesn't have infinitely elastic demand, similar for expensive cars.

Now cleverly constructed taxes are an obvious way for the government to try and change behaviour, but they run the risk of succeeding - in which case you then have the revenue question.
Fuel duty has a lot to recommend it, but it is a blunt instrument: which is probably why people have suggested variable road pricing as an alternative - higher prices for congested roads at congested times. I'm not sure about that personally, the obvious issue to me is that of never quite knowing quite what you're going to pay.
What I can say is that fuel duty increases are really, really unpopular in rural areas - if you have to drive a 40 mile round trip to see your GP, or 20 miles to school, it rankles a bit. Of course you can argue that living far from work and resources is a luxury, but the logic of that argument is that we should all move to London, and I'd hate to turn into a Londoner ;-)

bompington

phy2sll2 wrote:

I don't know much about cars, having never owned one, but say 20 MpG

Evidently. I can't get either of my cars to do less than 40, ever.

phy2sll2

bompington wrote:

phy2sll2 wrote:

I don't know much about cars, having never owned one, but say 20 MpG

Evidently. I can't get either of my cars to do less than 40, ever.

Yeah, but that figure would include includes trucks, coaches, buses etc.

tailwindhome

Rick Chasey wrote:

TailWindHome wrote:

Rick Chasey wrote:

That's just idiotic.

Free and easy with the old name calling rule there. Eh Rick?


[/Friday]

I think the pronoun you're looking for to make the point there is "you". As in, "you are idiotic".

Unfortunately, that's not there in the quote :P.

Naturally, the pronoun 'that' used is in reference to the topic discussed, rather than the person discussing it.

I give your mod bating 3/10.. All three points for getting the rise. None for being right .

Tough marking.

Surely 'that' refers to the opinion expressed rather than the topic, the natural implication being that the poster expressing the opinion was an idiot.

Similarly if I characterised the locking or deleting of a thread by a newly ordained admin as idiotic, the natural implication to any reasonable person is that I consider the admin to be a idiot.

Not that I would suggest such a thing....

rick_chasey

An extra point for persisting to dig.

Now, anything relevant to the OP you want to say?

tailwindhome

Rick Chasey wrote:

An extra point for persisting to dig.

Now, anything relevant to the OP you want to say?

There was an OP?

airbag

No I can't - there should be, instead, a minimum fee on parking, for any institution with more than say 20 spaces, with the exemption of park and ride schemes, and enforcement around the surrounding area to stop people parking on the road. I don't care if someone has a gigantic SUV instead of a Prius or whatever - I care if they use it for all and sundry. VED does nothing to discourage using a car when a better option should be available. Give locals the option of a 5-mile trip to a supermarket with free parking or a 2-mile cycle on congested roads into town, and you can't be suprised what option they take. Charge for supermarket parking, and install park-and-ride so that the roads into town are less congested, and you encourage local businesses, cycling, public transport - the works

rick_chasey

It'd be great if it were possible to put a flat tax on journeys.

So say, a trip round the corner in the car cost the same as a trip across the UK.

Not practical though.

jonomc4

For Tax to work for me has to be representative of use: e.g. the more you earn the more tax you pay.

Taxing of cars through fuel prices is positive taxation as you pay for what you use. Higher the tax the less you will use. The Gov has recently stated that it is going to look at VED because too many people are buying small cars to avoid tax - therefore their "guaranteed" cashflow is drying up. So the Gov is not using VED against pollution but as a way of raising taxes. But VED is a pointless tax - buy a £62,000 car - the VED is about £438 - is this going to stop me buying it? No it doesn't (it didn't even) and so what about the £280 a year in VED - no it doesn't - you look at it as the same way as the £12,400 VAT you pay on the car - just another Gov tax or the £1,200 a year insurance cost.

But what does stop me from using the big car all the time is the fuel prices - the smaller car gets used far more often and the bigger one for the longer weekend drives. Anyway for every mile I do in the car I do two on the bike.

The only argument against this is the many millions of people who have to use a car and are on a low income - think about a disabled person or someone who has to travel 40 miles each way to work and there is no convenient public transport - a higher fuel tax is making some of these people very poor. Unlike PAYE - it is the poor that are being hit by these indirect taxes far more than the rich - maybe it is better to reduce waste in public spending?

jonomc4

airbag wrote:

No I can't - there should be, instead, a minimum fee on parking, for any institution with more than say 20 spaces, with the exemption of park and ride schemes, and enforcement around the surrounding area to stop people parking on the road. I don't care if someone has a gigantic SUV instead of a Prius or whatever - I care if they use it for all and sundry. VED does nothing to discourage using a car when a better option should be available. Give locals the option of a 5-mile trip to a supermarket with free parking or a 2-mile cycle on congested roads into town, and you can't be suprised what option they take. Charge for supermarket parking, and install park-and-ride so that the roads into town are less congested, and you encourage local businesses, cycling, public transport - the works

When I come back from the supermarket - I normally have 15+ bags of food - I really don't want to take that on a bus or bike thanks. Supermarkets in town often charge for parking which is cut to zero if you spend over a certain amount. Free parking is a major customer incentive to use a supermarket - are you wanting them to suffer financially to pay for you emptier roads? I am sure they will do it, if you offer to fund the difference (got a few billion spare)?

airbag

jonomc4 wrote:

When I come back from the supermarket - I normally have 15+ bags of food - I really don't want to take that on a bus or bike thanks.

If that service matters to you that much, then you shouldn't mind paying a modest fee for it. Although hopefully, with more people taking stuff by bus, the buses would be better equipped to handle it, with more storage space. I can't say that tesco losing a few customers will stop me from sleeping at night either, nor do I think it would make the economy collapse.

navt

jonomc4 wrote:

For Tax to work for me has to be representative of use: e.g. the more you earn the more tax you pay.

Pfft. You too could save VED. Legit. Simply surrender ownership into a K2 scheme and you'd be smiling like Jimmy Carr.