Toll roads could be introduced to cover shortfall of tax from electric cars

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A view of toll booths along the M6 Toll road in the Midlands. PRESS ASSOCIATION Photo. Picture date: Saturday October 4, 2014. Photo credit should read: Yui Mok/PA Wire

A think tank has warned the government that toll roads may have to be introduced in the UK to make up for the shortfall of tax on petrol and diesel due to the rising number of electric cars on the road.

The study by the Policy Exchange, which was founded by Michael Gove, the environment secretary, said that the fall in the amount of income from petrol and diesel sales could be as high as £170 billion between now and the end of the next decade.


As a result, researchers suggested alternative sources of revenue, including the introduction of toll roads and GPS-style technology in all cars to track the number of miles covered on major roads.

The Policy Exchange report said that reforms were needed to address a drop in cash collected through fuel duty, which is set at 57.95p per litre.

According to The Times (https://www.thetimes.co.uk/article/toll-roads-backed-to-meet-lost-tax-from-green-cars-zsfjx2bgf), the report, which is titled Driving Down Emissions and was led by Richard Howard, the think tank's head of environment and energy, states that the government may have to tax road users directly, rather than through traditional tax methods.

"The changes to VED are a first step towards this: most road users will pay the same flat fee going forward.

"However, in time the government will need to seriously consider whether it is necessary to move to a system of road-user charging, either on selected roads, in certain cities or across the entire network (e.g. using GPS systems)."

Sadiq Khan, the mayor of London, is considering a similar pay-per-mile charging system to replace the current £11.50 congestion charge.