Gas-guzzling sportscars to receive purchase tax up to £23K

[RenesisEvo]

The concept, among many other flaws already highlighted, seems to be completely ignorant of cash flow. How many people can afford several K in VED at one time? Of course, you could just consider it as limiting your budget to a lower new vehicle than otherwise - but it's not clear how this would work for used cars. A few hundred every year is much more manageable for a person on the average (mode) wage, hence the (excessive) popularity of monthly payments. There's also fleet cars to consider. Of course, the government get a nice big wedge of cash straight up they can accumulate interest on, to the loss of that interest to the owner. If anything, it appears too much like a get-rich-quick scheme that is very short-sighted.

[randomnine]

I kinda like this. Higher cost and depreciation in exchange for no VED. If you prefer older cars and know how to look after them, it works out better.

Of course, the reason the government would love this is that they'd get all that money the moment a car's purchased rather than spread out over 10+ years. Even if the total duty paid on any given car doesn't change at all, collecting the duty on new cars earlier would create a massive revenue spike - something like £3-4bn/year, tailing off gradually - given they'd still be collecting a share of VED from older cars for a while as well as all of the VED for new cars each year. That alone would make a non trivial dent in the deficit.

One thing I'm curious about is how this would affect private imports. Will you be able to buy a new car more cheaply in the EU, bring it across and never pay VED?

[dvance]

There's days when I wake up and wonder, when the fk are people going to realize that science is the only way forward, and that the term politician needs to banned, and whomever wants to call themselves that shot on sight or alternatively banished on a deserted island.

The only meaningful way to tax based on CO2 is (as it's been mentioned several times already) to tax fuel. As we know, consumption/emission tests are just tests and they cover only a minuscule part of real usage -- queue the example with the super green mini driven above 70 mph resulting in the same consumption as a Mustang. But try to explain to a politician that vehicle and road tax are meaningless, and should be abandoned, and the only rational way forward is to only tax the fuel, oh no -- that's CRAZY. It's the only approach that combines fairness and accuracy when it comes to usage.

The only trick is including the electrical vehicles -- they can also be taxed on used electricity based on an average C02 emission per kWh energy generated or something of the sort.

[Prawnboy]

so a new idea is needed to keep VED revenues up.
i guess that means they have been falling.
with new car sales,(reccession aside),growing does this mean the plan to get people to buy greener cars is working, but the side effect is falling revenues?
time to revert back to the old system of per car and not by emmisions.
with more and more cars using the road with free,(or small),tax i think it is.

[matfitzpatrick]

I have always felt that VED should be based on fuel, so the more miles you do, the more you pay. I don’t think it’s fair that people who are able to enjoy high performance cars as weekend 'toys' should be forced to pay through the nose on tax when these cars cover probably no more than 4,000 miles per year.

I have just bought a Mini Cooper D which is tax free; however I will cover in excess of 20k per annum in it undoubtedly adding to the global CO2 more than a Ferrari that covers no mileage over the same period (if you buy into the whole environment nonsense that is!) and although I am using the VED rules to my advantage, I don’t think it’s fair and if the VED was not so crippling on higher performance cars would have something a little more involving to drive...

By adding it to fuel costs the Government could can an entire department reducing their running costs as it would be passed back by the fuel companies as duty currently is, it seems sensible to me...

[Edited due to shocking spelling!]

Edited by matfitzpatrick on Thursday 4th October 14:40

[RX7]

As said on the Porsche 918 thread, these whole vehicle based emission debate is like taking a dustpan and brush to help clean up after a volcano!!!

Why isnt the air industry hammered on a regular basis like the motorist, their emissions are far worse than any car? I cant conceive for any one minute we will have electric planes in the near future!

The treasury has already reported petrol sales are down this year, where the lose in revenue will have to be found from somewhere, but its exactly what they are wanting us to do, use less fuel!

How is it the common man like us see's the massive flaws in these things, yet these idiots seem completely ignorant of it?

Scrap the whole ved nonsense anyway, its an outdated system that is easily flouted. Put the extra duty onto fuel, those who use more, pay more, simples. No need to display a silly disc, employ 10's of thousands of people to send out millions of bits of paper, no need to police it, if your on the road driving youve paid, the cost savings would be astronomical! I wonder what it costs to run compared to revenue gained from ved?

Edit, just read the post above after writing this reply, seems i am not the only one!

[GeoffW]

Going to go out on a limb here but, considering the pros as well as the cons, I don't think it's the worse idea in the world. Particularly for enthusiasts like us.

Plenty of reasons but the main ones are:
- most of the the new tax will be picked up by companies not enthusiasts (I know it trickles down to us but you get the point)
- it reduces most people's annual outgoings immediately
- at a stroke, it eliminates the tax dodge of all the scroungers who currently don't pay their RFL
- it's a relatively cheap tax to collect (versus taxing individual motorists)

Paying more tax is like life, death and, err, taxes. I think the proposal is a serious, realistic alternative to the current system. And certainly a better alternative to continuing hikes on petrol duty or hefty increases in annual RFL based on CO2 - no thanks, not with my fleet anyway.

[Ocellia]

Years ago, it was suggested that Car Tax should be abolished and the fuel tax increased instead. So, the more you drove, the more you paid!
Simple. Even sensible (apart from the fact that the Fuel tax is already 80%+ of the cost of fuel!!)
BUT.....it wasn't put in force.
Why?
Because it would put too many people out of work in Swansea!!!

So you can be happy driving along, over-taxed, knowing you're helping the Welsh Economy!

[Twincam16]

randomnine said:

I kinda like this. Higher cost and depreciation in exchange for no VED. If you prefer older cars and know how to look after them, it works out better.

Ordinarily I'd agree, but when even a 1.25-litre Ford Fiesta is going to get hammered with extra tax for being a 'gas-guzzler' (FF'sFingS!), just think about the kinds of car this regime will force people into buying.

Hot hatches and quick saloons and estates will be killed stone dead by this. Luxury cars will too. Sports cars will only make sense to the stratospherically wealthy. Yes, I buy second-hand cars, but I buy good second-hand cars. If this were implemented the roads would be full of godawful eco-bubbles within 10-15 years. That's probably what they're trying to achieve anyway, but I can imagine the second-hand market will be a pretty grim place to be in a decade or so if this was the case. Everything will be a timebomb diesel, a thrashy little petrol on its last legs, or a gutless hybrid.

[IanHen]

Changedmyname said:

AC43 said:

Buy even cheaper used V8's and avoid it. Simple.

But someone somewhere will have to buy it in the first place so they become second,and that poor sod will lose a hell of a lot.

1) Isn't it true that around 50% of UK cars are company cars ?
2) This seems like a replay of my living in Singapore (2000 - 2002.) $30,000 Sing dollars added to the price of a Sentra/ Sunny plus 190% sales tax, total was close to $60,000 US dollars for a $15K US car !!!. Congestion charge to go into the city, and tolls on the Freeway both deducted from your cash card.
3) Yes the used price goes up, but ownership is very expensive.
EDIT. I forgot the whole reduce the Road tax argument going on at the time, it was reduced to about 2000 Sing dollars a yr.
AND Don't forget all the VAT promises made when it was introduced in the UK at 10%, to lower our taxes.

Edited by IanHen on Thursday 4th October 15:03

Edited by IanHen on Thursday 4th October 15:04

[405dogvan]

GavinPearson said:

Why does the UK Government feel the need to tax people even more?

Because as a country, we're heavily in debt and facing growing repayments with diminishing income?

In the name of 'encouraging growth and investment' (and forced by globalisation) we've slashed taxes for years (in reality that was politicians paying-back their favours, of course) but we're now in a situation where we cannot afford to continue, as a country - our income doesn't cover our expenditure and the gap is growing.

p.s. of course being engaged in brutally expensive (in money and lives) foreign regime-change and bailing-out gamblers who knew they would be saved by the people they'd already exploited is a big factor in this - but there are other, harder to point fingers at, things - like the fact we're living longer, working/earning less and driving everywhere(*) whilst we're (not) doing it...

(*) Except that the tipping point has probably arrived http://www.bbc.co.uk/news/business-19810276 ...

Edited by 405dogvan on Thursday 4th October 15:04

[otolith]

Twincam16 said:

this were implemented the roads would be full of godawful eco-bubbles within 10-15 years. That's probably what they're trying to achieve anyway, but I can imagine the second-hand market will be a pretty grim place to be in a decade or so if this was the case. Everything will be a timebomb diesel, a thrashy little petrol on its last legs, or a gutless hybrid.

I hate to judge a person by appearances, but this is the man behind the proposal;



He looks like he'd like that.

[Leins]

Twincam16 said:

Ordinarily I'd agree, but when even a 1.25-litre Ford Fiesta is going to get hammered with extra tax for being a 'gas-guzzler' (FF'sFingS!), just think about the kinds of car this regime will force people into buying.

Hot hatches and quick saloons and estates will be killed stone dead by this. Luxury cars will too. Sports cars will only make sense to the stratospherically wealthy. Yes, I buy second-hand cars, but I buy good second-hand cars. If this were implemented the roads would be full of godawful eco-bubbles within 10-15 years. That's probably what they're trying to achieve anyway, but I can imagine the second-hand market will be a pretty grim place to be in a decade or so if this was the case. Everything will be a timebomb diesel, a thrashy little petrol on its last legs, or a gutless hybrid.

Exactly, it would be like musical car seats for you guys if this came in. When the music stops, you had better have some nice stuff in the garage because there's no chance of getting anything else in the future

[Twincam16]

Ocellia said:

Years ago, it was suggested that Car Tax should be abolished and the fuel tax increased instead. So, the more you drove, the more you paid!
Simple. Even sensible (apart from the fact that the Fuel tax is already 80%+ of the cost of fuel!!)
BUT.....it wasn't put in force.
Why?
Because it would put too many people out of work in Swansea!!!

So you can be happy driving along, over-taxed, knowing you're helping the Welsh Economy!

Thing is though, how expensive would fuel end up if that's how it was taxed?

I pay £215 in VED on my car at the moment. I cover about 3000 miles a year in that particular car, doing about 30mpg.

If you were to spread it out over the course of a year, you're talking about an extra 5p per litre.

Doesn't sound like much does it? So little I'd probably be for it if VED was abolished.

Point is, it's too small an amount for the government to justify. 5ppl is the kind of increase you get with a mild oil price spike. This is a major policy shift. It'd be huge.

And would it stay constant or within a few quid regardless? Again, I doubt it. The government could do the equivalent of doubling VED on a whim with very little justification.

[405dogvan]

otolith said:

I hate to judge a person by appearances, but this is the man behind the proposal;



He looks like he'd like that.

Massive value judgements based on Daily-Mail-like rage are lovely but you realise that as they are, this 'idea' could actually make more powerful cars even more common and popular!?!?

Right now they cost a bomb but they sell AOK because there's plenty of people with that much money. An issue, tho, is that there are fewer people willing to take-on such cars down-the-line (seen the barge/shed threads - we're BATHING in V8s and V12s for the price of sweeties!)

By asking the 'rich' to shoulder the tax burden on the car, you actually open-up sales for these cars down-the-line - you ensure that these cars will live out their useful lives being used "as intended" by more people (people who'd not touch them now because of the likely costs).

Of course the rich don't lose entirely because their more-expensive trinket will keep it's value better - but they'll still shoulder more of the taxation cost as-a-whole (just as they shoulder the bulk of the depreciation on them now).

and I'm struggling to work-out how any of that is bad for petrolheads really...

[CoupeCrazy]

It's a way of clawing the missing revenue from the wealthy/high earners without the headline horrors associated with raising say ... income tax.

[405dogvan]

Ocellia said:

Years ago, it was suggested that Car Tax should be abolished and the fuel tax increased instead. So, the more you drove, the more you paid!
Simple. Even sensible (apart from the fact that the Fuel tax is already 80%+ of the cost of fuel!!)
BUT.....it wasn't put in force.
Why?
Because it would put too many people out of work in Swansea!!!

Don't be daft - the reason we don't swap to 100% fuel duty is that it would drive-up petrol prices at a time when they're already out-of-control (every time the Govt puts up the tax, the industry adds a bit to line it's pockets too)

AND

The risk with a single point tax is that people will use their cars less (see that BBC article I posted - it's happening already) and thus you suffer a major loss of taxation income just because oil got more expensive - something which is rather beyond your control being just a major government and not someone who can control this st.

[Leins]

405dogvan said:

Massive value judgements based on Daily-Mail-like rage are lovely but you realise that as they are, this 'idea' could actually make more powerful cars even more common and popular!?!?

Right now they cost a bomb but they sell AOK because there's plenty of people with that much money. An issue, tho, is that there are fewer people willing to take-on such cars down-the-line (seen the barge/shed threads - we're BATHING in V8s and V12s for the price of sweeties!)

By asking the 'rich' to shoulder the tax burden on the car, you actually open-up sales for these cars down-the-line - you ensure that these cars will live out their useful lives being used "as intended" by more people (people who'd not touch them now because of the likely costs).

Of course the rich don't lose entirely because their more-expensive trinket will keep it's value better - but they'll still shoulder more of the taxation cost as-a-whole (just as they shoulder the bulk of the depreciation on them now).

and I'm struggling to work-out how any of that is bad for petrolheads really...

That's great for the Ferraris and Lambos. But it's the middle ground that would get decimated, your Golf GTis, Audi RS4s, Boxsters, etc.

[otolith]

405dogvan said:

Massive value judgements based on Daily-Mail-like rage are lovely but you realise that as they are, this 'idea' could actually make more powerful cars even more common and popular!?!?

Right now they cost a bomb but they sell AOK because there's plenty of people with that much money. An issue, tho, is that there are fewer people willing to take-on such cars down-the-line (seen the barge/shed threads - we're BATHING in V8s and V12s for the price of sweeties!)

By asking the 'rich' to shoulder the tax burden on the car, you actually open-up sales for these cars down-the-line - you ensure that these cars will live out their useful lives being used "as intended" by more people (people who'd not touch them now because of the likely costs).

Of course the rich don't lose entirely because their more-expensive trinket will keep it's value better - but they'll still shoulder more of the taxation cost as-a-whole (just as they shoulder the bulk of the depreciation on them now).

and I'm struggling to work-out how any of that is bad for petrolheads really...

See earlier comment;

otolith said:

Worth noting that what the proposal actually suggests is scrapping the annual VED (road tax) charge and replacing it with a massive up-front charge. I can actually see the logic in that, in that it will tend to discourage the first purchase (end hence the building) of thirsty cars rather than the subsequent ownership. Taxing someone 400 quid a year to run a thirsty car which has already been built achieves nothing other than perhaps encouraging it to be scrapped earlier, a somewhat wasteful outcome.

I still don't like it, but taxing creation is more logical than taxing subsequent ownership.

However, there is no doubt that the objective of this idea is to stop the kind of cars we like to drive being built in the first place. It is intended to price thirsty cars out of existence and remove the option to buy them from the secondhand market.

[CoupeCrazy]

Leins said:

That's great for the Ferraris and Lambos. But it's the middle ground that would get decimated, your Golf GTis, Audi RS4s, Boxsters, etc.

Those poor hard up families having to cough up road tax upfront for their new 300 HP Boxster.