No more tax disc

Nairnster

Plans announced today saying that the tax disc is being axed after 93 years, to be replaced with an electronic system.

You will also be able to pay by monthly direct debit (at the penalty of it costing 5% more).

To begin October 2014.

markhewitt1978

My main fear with this is that the 'road tax' brigade will get louder "I'm paying a monthly subscription for the roads!"

Nairnster

They can say that all they want, but it still won't be road tax.

verylonglegs

So utility companies offer discount for paying by direct debit but the government actually charges more? Genius.

Nairnster

I know, bearing in mind it already costs more if you choose the 6 month option.

No used cars will have any VED left, as the seller will cancel there DD and the buyer will have to set up a new one. Will this catch some people out?

pyro_maniac

i read an expected 5% reduction in the fee if paying by direct debit! can't remember where though

markhewitt1978

Nairnster wrote:

I know, bearing in mind it already costs more if you choose the 6 month option.

No used cars will have any VED left, as the seller will cancel there DD and the buyer will have to set up a new one. Will this catch some people out?

If you know you are going to sell your car it does make sense to let the tax run out and go to monthly instead. You could already do this of course by posting the tax disc back, but nobody did.

I wonder if monthly DD will work for me or if they think taking £1.66 (+DD charge) per month will be worthwhile!

Nairnster

pyro_maniac wrote:

i read an expected 5% reduction in the fee if paying by direct debit! can't remember where though

Currently there is a 10% additional charge if you pay the tax for 6 months instead of a full 12 months. This is being reduced to a 5% charge.

However, for paying by DD there is a 5% additional charge.

raymondo60

A BBC journalist posed a couple of interesting questions;

How will we know when looking at a used car if it is 'taxed'? Easy answer will be to ask the vendor of course, but that allows for ambiguity ("Sorry mate, did I say September - I meant January!")

How would one recognize an 'abandoned' vehicle if left parked somewhere for a period of time?

I am also suspicious of the 'electronic methods' the government employs to manage the Vehicle Excise, MOT and Insurance details. If, as they claim, they can monitor all these legal requirements electronically, why are 30% of all private cars on the road uninsured (according to the Insurance Industry's statistics)? And why do the Police occasionally set-up 'road traps' with hi-def cameras to identify out of date Tax Discs?

Not convinced as yet and agree with the 'stick it on the cost of fuel' school.....

markhewitt1978

You can go onto the DVLA website and put in the reg no and car make and it'll tell you.

graeme_s-2

markhewitt1978 wrote:

You can go onto the DVLA website and put in the reg no and car make and it'll tell you.

Yup - this is already in place, I used it just the other day.

DavidBelcher

verylonglegs wrote:

So utility companies offer discount for paying by direct debit but the government actually charges more? Genius.

My home insurance company's the same - more expensive to pay by regular DD instalments than just one lump of dosh every 12 months. No doubt they cite transaction handling fees, blah, blah, blah....

David

bompington

Raymondo60 wrote:

I am also suspicious of the 'electronic methods' the government employs to manage the Vehicle Excise, MOT and Insurance details. If, as they claim, they can monitor all these legal requirements electronically, why are 30% of all private cars on the road uninsured (according to the Insurance Industry's statistics)? And why do the Police occasionally set-up 'road traps' with hi-def cameras to identify out of date Tax Discs?

Not convinced as yet and agree with the 'stick it on the cost of fuel' school.....

I would be a bit surprised if they do that - more likely ANPR, because once they have the reg they know more or less instantly whether the car is taxed and insured.
It's easy to catch uninsured drivers, but only if the police are focused on it - I suspect they just don't put that high a priority on it.

NB I'm a bit sceptical about the 30% claim... a quick google showed that figure in a headline from the Mail :? , but another couple of articles gave a figure of 1.2 million cars - still pretty bad, but more like 10%.

smidsy

Raymondo60 wrote:

why are 30% of all private cars on the road uninsured (according to the Insurance Industry's statistics)?

Well it might have something to do with insurance companies charging more for insurance than the car is worth (eg young drivers).

If you drive round in a 8 year old C1 (other small low power hatchbacks are available) worth £1000 and the insurance premium is £1500 chances are you will take the risk and not bother.

I am not blaming anyone - just stating a reason why it may be.

mattv

In my city the police regularly stop all cars in a bus-only section. Of these cars, around 30% are not correct on paperwork. But this is not a good sample, people who cant/ won't read signs also cant/ won't read letters saying tax/ insurance is up.
As an aside, is there any news on rolling VED exemption? My daily driver is a classic mini, a few years from the current date!

markhewitt1978

mattv wrote:

In my city the police regularly stop all cars in a bus-only section. Of these cars, around 30% are not correct on paperwork. But this is not a good sample, people who cant/ won't read signs also cant/ won't read letters saying tax/ insurance is up.

Quite; people who are driving in a bus lane generally have scant regard for the law / rules. Same as police will often do a search on someone they see not wearing a seatbelt, as not caring about that often means they don't care about paying insurance either.

pblakeney

smidsy wrote:

If you drive round in a 8 year old C1 (other small low power hatchbacks are available) worth £1000 and the insurance premium is £1500 chances are you will take the risk and not bother.

That may be a valid gamble to take. But what if, by perchance, you crash into a Rolls Royce?
That is an unlikely occurrence I will grant you, but I would not like to be facing that repair bill.

southdownswolf

PBlakeney wrote:

smidsy wrote:

If you drive round in a 8 year old C1 (other small low power hatchbacks are available) worth £1000 and the insurance premium is £1500 chances are you will take the risk and not bother.

That may be a valid gamble to take. But what if, by perchance, you crash into a Rolls Royce?
That is an unlikely occurrence I will grant you, but I would not like to be facing that repair bill.

Crash into a Rolls in a C1 and there's a good chance you won't be around to face the repair bill.... :shock:

Pross

DavidBelcher wrote:

verylonglegs wrote:

So utility companies offer discount for paying by direct debit but the government actually charges more? Genius.

My home insurance company's the same - more expensive to pay by regular DD instalments than just one lump of dosh every 12 months. No doubt they cite transaction handling fees, blah, blah, blah....

David

But that's because they are charging for credit. Insurance is purchased for a year so needs to be paid for at the time you buy it so in spreading it over 12 months you have to pay interest on the element you are 'borrowing'.

DavidBelcher

Pross wrote:

DavidBelcher wrote:

verylonglegs wrote:

So utility companies offer discount for paying by direct debit but the government actually charges more? Genius.

My home insurance company's the same - more expensive to pay by regular DD instalments than just one lump of dosh every 12 months. No doubt they cite transaction handling fees, blah, blah, blah....

David

But that's because they are charging for credit. Insurance is purchased for a year so needs to be paid for at the time you buy it so in spreading it over 12 months you have to pay interest on the element you are 'borrowing'.

Fair point. Never thought of it like that.

David

rolf_f

southdownswolf wrote:

PBlakeney wrote:

smidsy wrote:

If you drive round in a 8 year old C1 (other small low power hatchbacks are available) worth £1000 and the insurance premium is £1500 chances are you will take the risk and not bother.

That may be a valid gamble to take. But what if, by perchance, you crash into a Rolls Royce?
That is an unlikely occurrence I will grant you, but I would not like to be facing that repair bill.

Crash into a Rolls in a C1 and there's a good chance you won't be around to face the repair bill.... :shock:

I did see the result of a crash between a Saxo and a Ferrari 360 Spyder which tends to support your theory!

awavey

Pross wrote:

DavidBelcher wrote:

verylonglegs wrote:

So utility companies offer discount for paying by direct debit but the government actually charges more? Genius.

My home insurance company's the same - more expensive to pay by regular DD instalments than just one lump of dosh every 12 months. No doubt they cite transaction handling fees, blah, blah, blah....

David

But that's because they are charging for credit. Insurance is purchased for a year so needs to be paid for at the time you buy it so in spreading it over 12 months you have to pay interest on the element you are 'borrowing'.

well you arent because if you stopped paying at anytime during that 12months, your insurance is voided,so they only insure you for the time you keep paying,so its simply a scam to make money off selling the same product

rolf_f

awavey wrote:

well you arent because if you stopped paying at anytime during that 12months, your insurance is voided,so they only insure you for the time you keep paying,so its simply a scam to make money off selling the same product

Not really. Convention is that you pay for your insurance in advance (if anything, that is the only 'scam'). Because you pay in advance, the insurance company are able to invest your money which reduces their costs. If you pay monthly, they can't to the same degree - so insuring you costs more. So why should someone who pays in advance, and is unable to gain interest on the whole of that sum, subsidise someone else who is keeping much of that money in their own pockets for much of the year?

There's no real difference whichever way you look at it. Money has income value whoevers pocket it is in. If you can make more money by keeping it and investing it whilst making monthly direct debits than you can by paying a lump sum in advance, then go for it!

smidsy

PBlakeney wrote:

smidsy wrote:

If you drive round in a 8 year old C1 (other small low power hatchbacks are available) worth £1000 and the insurance premium is £1500 chances are you will take the risk and not bother.

That may be a valid gamble to take. But what if, by perchance, you crash into a Rolls Royce?
That is an unlikely occurrence I will grant you, but I would not like to be facing that repair bill.

Indeed, but people do not think THAT will ever happen and is part of the RISK I mentioned.

If you are hit by an uninsured driver YOU are the one who has to pay (even if indirectly through claiming on your insurance). The only thing the uninsured party is likely to be faced with is prosecution for no insurance involving a fine and or driving ban/points.

secretsam

The "Tax Disc" is an anachronism anyway - they can tell if your car's taxed from the licence plate / registration, ditto insured etc etc etc.

Charging extra for DD is a bit strong. Mind you, paying it in one lump means that they effectively have the money up front so can invest/offset the national debt a bit, etc.

No doubt car dealers will mourn the opportunity to add yet another place to advertise their business, ie the tax disc holder. My car came from Car Giant, as you can tell from the sticker in the back window, the number plates, the key fob, the tax disc holder and probably the tattoo on my ar5e done whilst it was numb from waiting for them to turn the blessed thing around...

drlodge

SecretSam wrote:

Charging extra for DD is a bit strong. Mind you, paying it in one lump means that they effectively have the money up front so can invest/offset the national debt a bit, etc.

I was very surprised to read that paying by direct debit would incur a 5% premium. While I accept this provides less money up front, there is also less administration to contend with, and ensures people continually renew their VED. Paying by DD must surely be a way of encouraging people to avoid being caught out having forgotten to pay their VED on time? I would love to setup a DD for my VED so I then forget all about it, but I'm not paying an extra 5% for the privilege! May be they will setup an annual DD option :idea: