Source: Spring Budget 2017
A15) The taxes that are most directly linked to motoring are Vehicle Excise Duty (VED) and Fuel Duty. Latest figures show that VED generated around £6 billion in 2015, down 1 per cent from 2014 and Fuel Duty about £27 billion. Revenue from Fuel Duty more than tripled between 1987 and 2010 but has remained at £27 billion since then.
Source: Transport Statistics Great Britain 2016 and DfT Table TSGB1310
In addition to specific road user taxes, some transport expenditure is liable to VAT. In 2012, for private households, a total of £12.2 billion in VAT was raised through motorists buying, running and using their vehicles. (VAT on vehicle purchases raised £3.84 billion; VAT on fuel raised £5.64 billion; and £2.72 billion of VAT was also raised through road users buying other motoring-related goods and services).
Motorists are also taxed for the use of company cars as a benefit in kind. The Road Users’ Alliance estimated the proceeds of this tax to have been £3.7 billion in 2011/12. Motorists also pay an insurance premium tax when they insure their vehicle and it is estimated in 2012 vehicle insurance premium tax costs road users about £560 million a year.
Motorists also pay for driving tests, MOT vehicle tests, and parking and other fees and fines. As these are associated with either a service or penalty, they are not treated as taxes in the analysis undertaken by the RAC Foundation.
Source: Public Expenditure, Taxes and Subsidies: Land Transport in Great Britain
A16) Latest figures show that in 2015/16, £9.3 billion was spent on roads in Great Britain.
Source: Transport Statistics Great Britain 2016 and DfT Table TSGB1303
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Economics