Road tax
If the motor car is todays mascot on the road, the road is also central to the existence of the motor car. It would not be out of place to say that there is a good chance that without a road a motor car would be an anomaly. The need of funds for the upkeep and further development of roads thus cannot be underestimated. One part of the corpus of these funds is in the form of what is called the Road Tax. It is a tax paid for the usage of automobiles on the road to the local or central government. All governments across the world levy road tax or a tax by any other name for use of the motorcar on the roads. What is a road A road is a path of travel that connects two points on the earth. Roads are made easy to drive by either paving them with brick or lining them with concrete. There are also asphalt and tarred roads. Trees are planted on the roadside and other obstructions are usually removed to give the car a smooth passage. Man has been making roads since time immemorial. Roads made by the Romans and Incas in South America are well known.
Road taxes are used for the upkeep and building of fresh roads. Some roads have tolls charges, where people pay a certain amount of money for the right to use the road. There may be toll taxes also for bridges and special highways. Road tax can be known by any name but the essence is the same. In the United Kingdom, road tax is referred to as Vehicle Excise Duty (VED). This is an annual tax that is levied on the owner of the vehicle which in turn gives him the right to use a public road or highway. Vehicle excise tax is collected by the Driver and Vehicle Licensing Agency (DVLA). The Driver and Vehicle Licensing Agency is an Executive Agency of the Department for Transport (DfT). The Agency comes under the purview of the Secretary of State and concerned Ministers. These Ministers in turn report to Parliament.
In the United States road tax is referred as car taxes, vehicle license fees, or registration fees. The taxes in the United States are not uniform and are imposed on a state-wise basis. The states work out their own rates. Even within states of the United States the tax may vary from one county to another. This is because some counties have surcharges that are payable by vehicle owners.
The principal of road tax is that any vehicle that uses a road must pay tax. As a corollary in case you are not using your vehicle for any reason and only parking it at home, the road tax need not be paid, but the agency responsible for collecting the tax must be informed on this. Owners of registered vehicles not using the public roads are required to submit an annual Statutory Off-Road Notification (SORN) since 1998. Failure to submit a SORN is a punishable offence and ranks at par with failure to pay duty and display a tax disc when driving the vehicle on any public road. All owners of Motorcars who have paid tax are issued with a vehicle license. This could be in the form of a sticker which can be affixed on the wind shield of the car or vehicle.
With pollution and emission having gained in importance over the years a slight change in the tax structure is implemented. Since March 1998, graduated vehicle excise duty (GRAD VED) has been introduced. This acts as an incentive to purchase vehicles with low emission levels. In the United Kingdom, the following rules for vehicle tax apply. Road tax on Cars registered before March 1, 2001 is charged according to the capacity of the car engine. For example in the 2006, 2007 the tax was 110 pounds for those with a capacity under 1550 cc, and for car above that capacity the tax is pounds 175. These taxes are paid annually.
However for Cars registered on or after March 1, 2001 the tax is charged not as per engine capacity but as per the levels of carbon dioxide (CO2) emission from the car exhaust. For the tax year 2007, 2008 this tax is up to 300 pounds, with the proviso that least polluting vehicles do not have to pay any excise duty at all. Thus the new electric powered cars stand out in this regard and will have zero or very low tax to pay.
Along with cars, motorcycles that ply on public roads are also subject to road tax. In England their rates vary from 15 pounds for motorcycles with an engine capacity under 150cc. Heavy goods vehicles (Hives) pay special rates that can go up to 1,850 pounds. However in almost all countries including England a few special-purpose vehicles such as ambulances are exempt from payment of road tax.
As with all taxes there are always people who try and evade paying their taxes. It is estimated in tax year 2002 / 2003, the evasion of the tax to the national Exchequer was nearly 206 million pounds. Attempts are made to reduce it and deterrent fines are imposed. A maximum fine of 1,000 pounds or lower amounts is imposed for failure to pay the tax.
An exception has been made for what are termed as Historic vehicles. Thus vehicles registered before 1 January 1973 is eligible for a free vehicle license. This is based on the presumption that such vehicle would not be used everyday and their consequent use of the public roads would be minimal.
Traveling across Europe also enjoins the owner of the motor vehicle to pay toll taxes at various points on the highways. To identify cars that have paid, small colored stickers called vignettes are affixed to motor vehicles. These are affixed on car windshields. These give the motorist the right to the use of motorways and motor roads in some European nations, such as Switzerland and Austria. The affixing of a vignette on a motor vehicle indicates that the respective road toll has been paid. Vignettes are valid for a year.
To prevent fraud the Vignettes are so manufactured that any attempt to detach them from the car will lead to its destruction. This ensures that vignettes are not detached and recycled for another vehicle. Road tax has come to stay. So long as roads exist and vehicles use them, the concept of the road tax will remain.
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