Active travel should be encouraged via smart taxation on “unnecessary” car journeys, says left-leaning IPPR.

Encourage modal shift with reform of motoring taxes, urges thinktank

In a report bound to infuriate those wedded to their cars thanks to motor-fixated infrastructure paid for by all, the left-leaning Institute for Public Policy Research argues that many poorer motorists subsidise richer ones, and that reform of motoring taxation is overdue and vital.

The 62-page IPPR report is called ‘The Long Road to Ruin – why the UK needs to reform motoring taxes’ and was written by IPPR Fellow Mark Rowney, a Labour candidate standing in Battersea, south London, in coming local elections. IPPR’s northern office in Newcastle carried out much of the report’s background interviews with members of the public, who, once shown the unfairness of the current motoring taxation system were far more willing for changes to be take place. The interviews also revealed that people could be encouraged to reduce their dependence on cars if infrastructure for walking and cycling were improved.

Before any reforms to motoring taxation are carried out – such as the move to a pay-per-mile policy, as used in some other countries – the UK Government should prioritise road improvements: “potholes affect everyone who uses the road, regardless of how they travel,” said Rowney.

“Since our poll shows that people really do care about them, fixing potholes before mandating any change of the tax system is a sensible precaution to help secure public support for change.”

The report starts by saying: “Britain is a nation of motorists. At the end of 2012, 28.7 million cars and 34.5 million vehicles were licensed in Great Britain, and on average 64 per cent of all personal trips in 2012 were made by car. Motoring is a fundamental aspect of British society, one that generates a revenue stream upon which the state is dependent.”

However, this revenue stream is under threat because Vehicle Excise Duty (“commonly and incorrectly known as ‘road tax’” says the report) is based on emissions and “cleaner” cars pay less VED. Current motoring taxation is regressive, says Rowney, having a greater financial impact on poorer people.

“Public transport, worsened by recent cuts to bus services, fails to provide adequate services to those who can’t afford to drive. Other areas of policy such as urban planning have left the public (outside central London) unnecessarily dependent on cars, and as a result the poorest quintile of the population take more expensive taxi trips each year than any other income quintile…With the average cost of owning a car running at £90.70 per week, and average fuel costs at £32.10 per week, increasing motoring taxes would be both politically difficult and manifestly unfair.”

The report is strong on the largely under-reported negative externalities of motoring, such as congestion, crashes, air pollution and damage to roads. Motoring, while convenient at off-peak times, is a major contributor to the nation’s lack of fitness:

“People sitting in buses and cars to get to their destinations are not travelling actively. The average time the public spends walking and cycling fell by 16.7 per cent between 1995 and 2012, and the British Medical Association has stated that the annual cost of transport-related physical inactivity in England is £9.8 billion, in addition to the £2.5 billion annual healthcare costs of obesity.”

Rowney says: “Motoring has created a public health disaster,” adding that “active travel (walking and cycling) is associated with numerous health benefits, including improved mental health, a reduced risk of premature death, and the prevention of chronic diseases like heart disease, stroke, type 2 diabetes, osteoporosis, depression, dementia and cancer.”

A Cabinet Office estimate puts the economic costs of transport-related physical inactivity in England at £9.8 billion per year, in addition to the £2.5 billion annual healthcare costs of obesity.

“The total costs of the externalities that have costings attached to them are in excess of motoring taxation receipts,” said Rowney, rebutting the claims from some motoring groups that motorists are “cash cows.”

Controversially, the report looks at methods of “tracking” motor car use and charging more for frivolous use:

“It is theoretically possible to create a system that targets individual unnecessary journeys and makes allowances for people’s incomes.” This will be leapt on by detractors as “Orwellian.”

Rowney admits that “motor taxation is seen by as politically toxic” and that asking the public if they want to see motoring taxation changed – say with a congestion charge – usually say “no”. However, in focus group meetings, IPPR found that when people are given information on the impacts of motoring and the current unfairness of the taxation system, people would be much more likely to vote for change.

“Our research has shown that the public is very open to modal shift. Despite the fact that our poll showed that the public’s top two concerns were the cost of motoring (at 53 per cent) and potholes (at 40 per cent)…[there was also a desire for] improving cycling facilities (23 per cent).”

The IPPR report suggests that walking and cycling should be prioritised over public transport:

“Our workshop participants did express a strong desire for promoting and improving active travel which does not contribute to pollution. This finding, combined with the high cost–benefit ratio of active transport investments, suggests that these should be given priority over public transport improvements in any modal shift element of a motoring tax reform campaign.”

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