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Editor's Blog: Road tax rage
Isn't taxation supposed to be simple - and fair?

By Tony Hallett

Published: Wednesday 09 August 2006

I want to get my teeth into the subject of road charging but first, I wouldn't be doing my job if I didn't herald the launch of silicon.com's latest vertical-specific section. In fact, adding to our successes over the past 12 months with Public Sector and Financial Services, the new Retail & Leisure section actually tackles two closely related sectors.

Our business editor Steve Ranger is behind this launch and we hope it allows us to better serve CIOs and others in these areas. For everyone else, the radical changes we see in this space should be instructive.

But, as I indicated, the start to this week was a bit of a humdinger, what with an update on government proposals to change the way we are taxed to use the UK's roads. The news itself wasn't a huge update - it was based around a 'leaked' document seen by The Times - but the reaction from our readers really got me thinking. (This week I've been moderating our Reader Comments and you can see all of them for this story here.)

The mix of comments is pretty rich, which is great. I won't try to cover every angle. The best ones grasp the concept that any proposals aren't just about a 'black box' that tracks a vehicle's movements using GPS. They're about charging according to the route that is taken and what time a journey is made.

Forget about all the TV news reports you saw talking about making every road a toll road (an interesting image). This subject is interesting because it is all about efficient networks and because it promises to affect almost all of us.

Assuming you are not overly paranoid about being tracked - as if your vehicles can't be tracked anyway now - then this is a solution to some congestion woes. Staggering journey times, where possible, and routes, where possible, are good ideas. (Note, the 'where possible'.) Making all this 'revenue neutral', as they say, to our tax-raising authorities is also key.

In fact, the starting point for intelligent debate seems to be about scrapping fuel levies (the UK has some of the highest in the world) and annual road tax, and doing everything based around mileage, route and time.

But what might happen? If you are someone who will benefit greatly - maybe you travel infrequently, on rural roads, at off-peak hours - there will be someone else who has no choice but to hit busy rush hour roads, many times per week. The latter group will be the ones who protest loudly.

The fudge will then be to keep a tax on fuel, maybe even annual road taxes. That will all be costly, confusing - and risk not being 'revenue neutral'.

Wasn't one of Adam Smith's tenets about taxation that it's simple? On that count, levies on a litre of fuel are the simplest solution. Problem is, we already protest about the price of fuel. And another tenet of his was that taxation is also fair.

Ah, who'd be an economist? Or a road planner.