Older drivers would have ‘benefitted most’ from car tax change ditched by Labour

Older drivers may have “benefitted most” from new car tax changes axed by Labour last Autumn. Finance experts suggested petrol , diesel and electric motorists in later life may have actually saved money if a pay-per-mile road tax system was introduced. A charge calculated on how far drivers travel instead of a flat annual fee had been suggested in the run-up to last November’s Autumn Budget.

There were rumours that the Treasury was already working on a road pricing scheme with an announcement thought to be imminent. However, the DfT confirmed a pay-per-mile plan was off the cards just days before Rachel Reeves’ budget with electric vehicles instead slapped with Vehicle Excise Duty (VED) fees. Despite this, older motorists may have gained if a road pricing system was launched due to their mileage often being low.



Bradley Post, MD of tax specialists at RIFT previously said: “The pay-per-mile car tax has been proposed as a replacement to car tax which will essentially see motorists charged based on the number of miles they drive each year. “The idea behind it is to replace fuel duty tax revenues that the government will lose out on as more drivers transition to electric vehicles. “Those due to benefit most are the motorists who don’t rack up the miles, older motorists and those who live in more urban areas with good public transport links.

” According to care alarm provider Taking Care , older drivers above the age of 70 travel just 1,665 miles on average every year. Analysis shows this is a whopping 28% less than the average mileage achieved by every other age group. It’s no surprise that elderly individuals are also believed to be more willing to sign up to a pay-per-mile scheme if one was ever introduced.

A YouGov survey of 2,000 UK adults found that just 26% of drivers approve of the idea. However, 33% of motorists above the age of 55 back the concept compared to just 19% of younger drivers between the ages of 18 and 34. Although those on low mileage could save, there were serious concerns that motorists relying on their vehicles may pay more.

Iain Read, head of editorial at Carwow said: “Unsurprisingly, those who drive the most miles will pay the most. “If you are a high mileage driver you could pay more under pay-per-mile than you do under the current VED system, low mileage drivers could pay less.”.