A recentreport from Bloomberg New Energy Finance has warned that the UK government willhave to consider nationwide road tolls if, as expected, the popularity of electricvehicles continues to rise.
Fuel dutygenerates significant revenue for the Treasury’s coffers, with £28.8 billionexpected to be recouped in 2019 alone.
If Britain’smotorists continue to move away from petrol or diesel-powered vehicles toward electricmodels, the Treasury will need to find a way to plug the hole in governmentfinances left by a drop-off in fuel duty.
This issueis not exclusive to Britain. The UK, along with the United States, China andGermany would see a combined £1.4 trillion lost in fuel taxes between now and2040 if more motorists and commercial fleets plump for plug sockets over petrolpumps.
New datafrom the Society of Motor Manufacturers and Traders (SMMT) reveals that morethan 4,500 new electric vehicles were registered in the UK in February.
This equatesto a 34% year-on-year increase, making February the 22nd successivemonth for rising UK registrations of zero-emission vehicles.
Unsurprisingly,electric vehicles are not subject to fuel duty, and Bloomberg’s study indicatesthat the introduction of tolls on Britain’s busiest motorways anddual-carriageways would help to generate new funds.
Presently,UK motorists pay 57.95p of fuel duty per litre of petrol or diesel. Fuel dutyhas been frozen for an unprecedented nine years by the government. Given thatthe average British motorist drives 7,800 miles per year, this equates toannual fuel duty bills of £1,000 per household.
To recoupthese lost earnings, Victoria Cuming, head of global policy at Bloomberg NewEnergy Finance, recommends introducing a mileage-based toll system, withmotorists charged 7.5p for every mile driven by 2030.
The chargewould then rise to 9.1p by 2040, coinciding with the ban on the sale ofbrand-new petrol and diesel-powered vehicles in the UK.
Using thecurrent average annual mileage, this would result in motorists being charged£700 for annual road toll payments by 2040 – still £300 less than the averageUK household’s annual fuel duty bill today.