Irish Road Tax 2013

[Dan]

I don't see why we don't just add it onto fuel duty in the UK. It'd only be a tiny increase compared to what fuel duty currently is, and it'd save all the administration and enforcement of an extra tax.

[mcandmar]

I agree, the fairest system as those who drive the most, pay the most. Problem is the current Duty and Vat on fuel is already ~60%. Found this while googleing,

Cost of Crude €0.507, Profit Margin € 0.191, DUTY € 0.588, VAT € 0.296, Cost at the pump € 1.582 per litre.

The other thing i object to is how motor tax is used. I'm not sure about the rest of the UK but in Northern Ireland road tax goes into the Transport budget to maintain roads and transport infrastructure. In Ireland its just another revenue stream for the government to spend as they please, so **** all goes into maintaining the road infrastructure. If you ever cross the border into Northern Ireland the difference is immediately obvious, they know how to build proper roads, down here its no more technical than covering your driveway in tarmac. And for most B roads they seem to think its perfectly acceptable to spray a layer of tar, and then dump a few tons of gravel on top. They actually call it "surface improvement"

[Dan]

Road tax in the UK hasn't been specifically ringfenced for road improvement since 1937.

On the other hand, it hasn't come close to covering that bill, so most of the money going towards the road network comes from general and local taxation.

Fuel tax certainly goes into the general pot. The reason it's so high is that in theory, it's a Pigouvian tax; that's a tax designed to compensate for externalities. An externality is something that happens as a result of a transaction that is not paid for in that transaction.

So, for example, buying and using petroleum-based fuels has the cost of digging up that oil, which you do pay to the oil company. It also has the cost of the pollution (be that climate change, or local effects like city air quality), which the fuel company doesn't bill you for because it's not something that affects them personally.

Adding the tax is a way to compansate for those externalities in two ways:

1. By raising the price, it appropriately dis-incentivises purchases. The price one is willing to pay mostly comes down to what value it has to one personally, so in theory, people should cut down on less-necessary travel and prioritise neccessary travel.
2. The revenue from the tax can then be used to deal with the resulting externalities; i.e. cleaning up pollition deposits on city buildings.

There are some major problems with both these angles, however:

1. If everyone in the country had around the same level of wealth, the dis-incentive would work very well. We would all cut down on trips we don't need to make, using our cars slightly laisses-fairely. But what you actually have are three distict groups:

a) Those who are relatively poor, who use their cars only for necessities anyway; i.e. commuting to work. When tax increases, these people will not be able to reduce their use, so will simply have to pay more (and be pushed towards fuel poverty).

b) Those 'in the middle' who use their cars partially for necessities, partially for fun. Probably likely to cut down on some fun use as prices rise.

c) Those who are very wealthy. Again, some necessity use, often quite a lot of frivolous use. They can however, afford to simply pay the extra when prices go up and still go joy-riding, so their use does not fall.

In other words, it is only for one wealth strata that a Pigouvian tax actually decreases use.

2. The revenue from road tax is generally not spent on countering the effects of externalities. Currently it is mostly being used to pay the interest on a bailout of the UK's financial sector.

3. The type of externalities we're dealing with are harder to combat. My example of cleaning up pollution deposits was a real issue for old diesels, but the primary problem with modern cars, with cats and DPFs, is just CO2 leading to climate change. So far, nobody has a magical 'insert £1 and suck CO2 back out of the air' machine. Plus, the consequences are more-likely to be felt half way across the world, where taxpayers here frankly don't care about.

tl/dr: Fuel duty is admirable in theory, but has some serious practical problems.

[vidar skotheim]

In Norway we pay about £1.4 pr liter fuel . £330 road tax . insurence on a old car is about £250 .
a 2001 rs4 cost now £40.000++
2008 rs4 cost £89.000

and to register a new owner cost maybe from £200-£2000 ...


Expensive..............
And the roads are not that great .. instead of making roads we rent out a lot off money to germany ++++ for maybeee 2% interest

And the schools and hospitals and house for old peopel are "old" and maybbe stand empty because they dont have money to open it ..

[Error404]

Personally I would love to scrap the current fuel tax and road tax systems and instead bring in a system where you are charged per mile, dependent on the time of day you use the car, how congested the roads are, and the length of your journey, with the tax front loaded so the first mile costs 90% of the journey total. In the UK we have some of the worst traffic congestion in the world, mostly caused by lazy ***** and school moms.

[psiconauta911]

Hi all,

In Portugal, sinking in a very deep financial crisis, an S2 pays less than 80€ of road tax equivalent a year, and for a classic car status you can insure it for about the same 80€ per year, 3rd party only and no mileage limit, result my s2 costs me around 160€ per year to keep it on the road, except maintenance of course and super unleaded it´s around 1,7€ per litre.

[LHD_Kid]

In Belgium, yearly tax is paid for the power of the car, 400 Bhp = approx EUR 5,000
No modifications allowed, so no power other than standard -oh, and because its old, you can only have 3rd party insurance - which is around EUR 1,500. Such a ridiculous country...
UK has it sooooooooooo easy it's unbelievable..... I really thought otherwise until I saw Belgium.
Also in Belgium there is Council tax, bad roads and a standard stoppage rate on all your income (at any level) of around 50% (any overtime you can up that to almost 65%)
Petrol around EUR 1.79 per litre....

[rynaqui]

And I thought I had it bad

I've got 1.5k euro for license and 400 for 3rd party insurance..

[quattro84]

In The Netherlands road tax is based on weight & petrol and by the added tax from the county you live in, and non dependant of car age until it reaches 25 years making it an oldtimer. The current plans on the political agenda will stop this legislation because there are shitloads of imported Benz diesels on the roads now...

Road tax has to be paid to the local county/state, for an Avant S2/RS2 roughly being €900,- and €725,- for a Coupe S2 a year.
Quality of the roads is great though, downside is the immense loads of salt being used in the winters.

Petrol prices are comparable to what you pay in the UK.

Insurance prices can differ, being as low as two tenner a month but that will be based on the value that is listed by your insurer. Without a new taxation they will call it a total loss if damage claims are over €1000,-

[Dan]

Personally I would love to scrap the current fuel tax and road tax systems and instead bring in a system where you are charged per mile, dependent on the time of day you use the car, how congested the roads are, and the length of your journey, with the tax front loaded so the first mile costs 90% of the journey total. In the UK we have some of the worst traffic congestion in the world, mostly caused by lazy ***** and school moms.

Back in the day, we had to walk to school... bare foot, wading through peat bogs... kids these days don't know how good they've got it...