The number of cars without Vehicle Excise Duty (commonly referred to as road tax) has trebled since 2013, according to figures from the Department for Transport.
The DfT estimates there are around 750,000 unlicensed cars in the UK. This would mean a potential loss for the Treasury of up to £107 million every year. It says road tax evasion has increased from 0.6 per cent to 1.8 per cent since 2013.
See also: A quick guide to car tax
It also says that 12 per cent of drivers without tax have actually declared their car as SORN (Statutory Off Road Notice) – that's a vast increase compared with just one per cent in 2015. "This is clearly people deliberately breaking the law," said a statement from the Driver and Vehicle Licensing Agency.
The DfT admits that the increase in untaxed vehicles "could be due to the major changes to the licensing system which took place in October". Those 'changes' marked the end of the paper tax disc and saw vehicle licensing move online. It also stopped the practice of tax being transferable between owners.
The DfT's figures also highlighted that 51 per cent of all unlicensed cars are over 10 years old.
Oliver Morley, chief executive of DVLA, said: "More than 98 per cent of all vehicles on the road are correctly taxed. We continue to collect around £6 billion in tax every year which clearly shows that the overwhelming majority of motorists stay legal and tax their vehicles on time. We are cracking down on those who break the law by driving an untaxed vehicle and our message to tax dodgers is clear – tax it or lose it."
But the RAC said the figures showed changes to the licensing system clearly hadn't worked, with public affairs manager Nicholas Lyes saying: "The principle of abolishing the tax disc to introduce greater efficiencies has, so far, evidently failed.
"More must be done to educate drivers about how and when to tax their vehicle, coupled with stronger enforcement to genuinely make drivers who evade vehicle tax feel that they are going to get caught."