Reform Scotland

Pay-As-You-Drive Road Pricing

Reform Scotland calls for Chancellor to makes case for road pricing in Spring Statement

Reform Scotland, the independent, non-partisan think tank, has today released a new briefing – Pay As You Drive – which advocates the abolition of Vehicle Excise Duty and Fuel Duty and their replacement with a system which charges drivers for the use of roads.

The think tank is a long-term advocate for road pricing, having published its first Pay As You Drive paper in 2013 and is calling for Chancellor Rishi Sunak to use his Spring Statement to acknowledge the need to move towards it.

Reform Scotland argues that, as we move towards cleaner cars which pay less or no tax, the country will gradually lose the revenue it currently collects as a means of paying for road building and maintenance.

The think tank also argues that Fuel Duty and Vehicle Excise Duty are blunt instruments which unfairly punish less well-off drivers with older cars, and those in rural areas or who work unsociable hours and have no alternative to the car.

Instead, it proposes a pay-as-you-drive system which uses in-vehicle technology to charge motorists variable amounts depending on which road they are using, which type of vehicle they are driving and what time of day they are driving.

Road pricing has recently been endorsed by the House of Commons Transport Committee, and Reform Scotland is calling for the UK and Scottish Governments to work together to investigate the feasibility of a UK-wide scheme, and to implement it.

"Vehicle Excise Duty and Fuel Duty are taxes of the past. They are indiscriminate and blunt, often over-taxing people who can least afford it and under-taxing those who can.

"They are also not fit for a future of clear, and ultimately electric, cars. In less than a decade the only new cars for sale will be electric, which will pay neither of the taxes.

“It is well beyond time for the government to pull its head from the sand on this issue and create a new system which is fair, raises sufficient revenue, and also critically encourages drivers to make better choices in the knowledge that they will suffer financially if they do not.

“This is a problem now - we can’t wait another ten years for decisions to be made.”