Electric cars will leave hole in tax revenues, says Treasury

They’re just stating the obvious, but now a few people have made the switch away from fuel-burning cars their warnings will no doubt become louder. Non-car owners can’t be penalised with an electricity surcharge, and EV subsidies can’t be handed out to everyone forever. They add a free dollop of climate alarm miserablism to their mutterings.
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Taxes must increase or services be cut to compensate for the loss of fuel tax income thanks to the advent of electric cars, the Treasury has admitted.

Officials have been long concerned about the future loss of more than £30bn in revenue from drivers, says BBC News.

In a new review the Treasury has acknowledged the problem in a way that will spark a debate about how driving should be taxed in the future.

One idea would be to charge motorists for every mile they drive.

But the AA says such road pricing will be tough to sell politically.

Instead, the motoring organisation is proposing a system of “Road Miles” in which motorists are allowed to drive free of charge for 3,000 miles (4,000 in rural areas) before they start paying.

The Treasury review offers another striking conclusion from a government department traditionally worried about harm to the economy from cleaning up the UK’s emissions.

The latest message is the opposite – that tackling climate change might even benefit the economy by giving the UK a lead in clean technologies.

It says: “Overall, in the context of the rest of the world decarbonising, the net impact of the transition on growth to 2050 is likely to be small compared to total growth over that period.

“It could be slightly positive or slightly negative.”

The document continues: “Climate change is an existential threat to humanity. Without global action to limit greenhouse gas emissions, the climate will change catastrophically with almost unimaginable consequences for societies across the world.”

Full report here.

via Tallbloke’s Talkshop


December 18, 2020 at 03:09AM

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