Government could lose £119 million as more drivers dodge road tax

Published 30 November 2021

Lost revenue from road tax avoidance could be as high as £119 million this year, as the number of unlicensed vehicles in the UK soars. 

There are an estimated 719,000 untaxed vehicles (excluding motorcycles) in the UK, the equivalent of 1.8 per cent of all vehicles on the road, according to the latest Department for Transport (DfT) report. 

That is up from an estimated 634,000 vehicles (or 1.6 per cent) when the last data was published in 2019, and is not far behind 2017’s estimated 755,000 vehicles (or 1.9 per cent). 

Those figures are all significantly higher than before the DfT abolished the paper tax disc in 2014 and ended the process of transferring tax between vehicles. 

In 2013, prior to the changes, just 0.6 per cent of vehicles were untaxed. 

Tax Discs (2)

This year’s statistics are based on a roadside survey using automatic number plate recognition (ANPR) cameras at 267 sites in June and early July. 

More than a third (38 per cent) of the UK’s untaxed vehicles are 10 or more years old (similar to 2019’s 40 per cent), while the number of untaxed vehicles less than two years old is slightly fewer at nine per cent. 

More than half (55 per cent) of the vehicles have been unlicensed for two months or less. 

Jack Cousens, head of roads policy for the AA, said that the figures could have been higher given that hundreds of thousands of cars were granted a Statutory Off Road Notification (SORN) status during the Covid-19 lockdowns.

"Some of those vehicles will have been put back on the road with the owners either mistakenly or deliberately forgetting to tell the DVLA (Driver and Vehicle Licensing Agency)," he said. 

 Untaxed Vehicle

The penalties for not paying road tax are severe. Drivers could face a hefty fine and prosecution, and the DVLA has the right to clamp the vehicle until the correct amount of tax is paid. 

RAC head of roads policy Nicholas Lyes said that the increase in the number of unlicensed vehicles is “hugely concerning”. 

“While we’d like to think the abolition of the paper tax disc back in 2014 isn’t responsible, the fact remains evasion has increased significantly since then to the point where a shocking two in every 100 vehicles on the road aren’t taxed,” he said. 

“The cost from VED evasion in 2021 alone is set to be a whopping £119m, a substantial sum that should be spent on improving our road network. 

“We urge the DVLA to step up enforcement and to do all it can to bring evasion down, as it is clearly not fair on those who do pay their fair share to drive on the road.”

Car And Coins 

The DfT said that some of the estimated £119 million of potential revenue loss over one year will have been recovered by DVLA enforcement activity or by vehicle keepers paying arrears of VED at a later date. 

That means the ‘real loss’ to the Treasury is unlikely to be as high as £119 million and that figure is an 'upper estimate'. 

Julie Lennard, DVLA chief executive, said: “We work hard to drive down vehicle tax evasion and the vast majority of motorists are doing the right thing with over 98% of vehicles on the road taxed correctly. 

“Estimated evasion rates fluctuate and the pandemic is highly likely to have impacted some motorists’ behaviours. Those who choose to evade will be tackled using our proven package of comprehensive enforcement measures.

“These include penalties and court prosecutions through to the use of Automatic Number Plate Recognition cameras, wheelclamping and the removal of untaxed vehicles.

“You can tax your vehicle using our quick and easy online services – available 24/7 – and the costs of vehicle tax can be spread throughout the year by opting to pay in instalments by direct debit, which is a popular choice with nearly 15 million vehicles taxed this way in 2020.”


hissingsid    on 1 December 2021

This situation was self inflicted and avoidable. Whatever the so called experts say, the abolition of the tax disc encouraged a significant number of drivers to take a chance and fail to pay.
The savings made by going paperless must have been greatly outweighed by the loss of revenue resulting from the increased evasion.

Falkirk Bairn    on 2 December 2021

DVLA saved £30 million to print tax discs + distribution costs.
That said £120m of evasion the paper disc cost looks cheap.

Shove the RFL on petrol/diesel - nobody can avoid buying fuel except if you leave the car in the drive and never use it.

Contax139    on 2 December 2021

Better to charge per mile for use of roads with higher rates for motorways than normal roads as they require more service by highways patrols and monitoring. Would also mean EV's would pay their share.

tall and hairy    on 3 December 2021

No never! Road pricing would be 20x worse and hits the poorer disproportionately. We get told when and where to work and dont have the luxury of rescheduling meetings.

Why should the rich who can afford the benefit of travelling when they want be gifted clearer roads?

Any extra revenue will be sucked up by fat cats and the costs of implementing the ANPR systems required to administer it, if anything lobby your MPs to avoid road pricing at all costs.

As said by someone else at least fuel duty or VAT on electricity is hard to dodge.

hissingsid    on 2 December 2021

For years I and many others advocated scrapping VED and increasing the duty on petrol and diesel to compensate, but this is no longer the easy option it once was.

The tax yield from petrol and diesel is already declining as EV's become more popular, so VED will stay and will soon include cars such as EV's which are currently exempt.

The only long term alternative would be road pricing, expensive to operate fairly and likely to prove even more unpopular with motorists.

Richard M Russell    on 2 December 2021

Add VED to EV charging plus 3rd party insurance? Is an untaxed vehicle insured?

JackIoW    on 2 December 2021

I thought your Car Insurance was invalid if the Car isn't Taxed ?

Contax139    on 2 December 2021

Shows the system no longer works fairly,

soldierboy 001    on 2 December 2021

One way would be for the car to be taxed for one year by the current owner at one given time of the year, say the 1st of April then if it is sold on it doesn;t matter because the new owner will be buying a registered car. There would be no worry about it being paid as the computer can cope with many payments in a small time and the owner could be given the whole month of March to make the payment. It's easy like the Spanish do to have a company set up to send out the reminders to all car owners with the payment due and the means of paying.

   on 2 December 2021

Why not admit the sheer stupidity of abolishing the paper disc, there was a problem solved by that i**** Osborne, that didn’t exist.

   on 2 December 2021

Scrapping the paper disc was sheer lunacy !

Thia was a good, simple idea and at a glance anyone could see if a car was taxed.
I believe the disc should be brought back , plus another disc showing if a car is insured.

They deserve to lose this revenue , the old system worked.
If it aint broke ---- don 't fix
Too much reliance is placed on technology today.

Contax139    on 2 December 2021

Technology not as effective as the patrols we used to have, and car caught without tax or insurance on the road should be confiscated, would also do same if no MOT as you have a month before MOT expires to get it redone, send a warden round towns and villages at night with a hand scanner to check all parked cars for tax and insurance, any caught clamp and confiscate.

Lee Arnold    on 3 December 2021

So many people also tax their vehicles and forget about their MOT

So many people do not know the Government websites exist

Car tax checker and Car Vehicle History

Car Tax Discs needs to be brought back and displayed on windscreens
It would solve many problems

Mark Rhodes    on 3 December 2021

I thought, in order to tax a car, it had to have valid insurance and MOT at the time of taxing.

Simple: add 2p per litre. Can't avoid 'contributing' then.
10000 miles = £200 in the 'pot'
5000 = £100 in the 'pot's

You are then effectively paying for what you use.
Might make people consider whether to drive or bike / walk as an added Brucie Bonus.

Flipmepoo    on 3 December 2021

These numbers have come about purely because of the way the direct debit system works in my opinion.
It has some serious flaws. I have 20 years +experience in this field.
The main issues are as follows:
If you tax a vehicle part way through the month and offer to pay by DD, depending when you do it, the first DD claim won't be due to the following month, which is just stupid.
If you then sorn the vehicle on the last day of the month, (which you are perfectly legally entitled to do so) even if you don't cancel the DD, the dvla WILL NOT take the payment ., and report this is as evasion. There must be tens of thousands of drivers who have do this, and they should not be forced to keep the car taxed onto the next month just so the previous month's DD can be taken.
This happened to me on three occasions where I only needed to use the car a couple of weeks at a time during lockdown, and I was more than happy to pay for tax for a whole month , instead I ended up with 3 dormant direct debits just sitting there , and dvla putting a block on direct debit payments on the vehicle. Counter productive and just doing themselves out of money .
In the old days this would have meant you would have paid for the two or three weeks tax already.
I can see this is a lot of their missed revenue gone immediately even for drivers acting legitimately, they just report back and say people are evading it when in fact their payment system is a load of turd.
No payment date changes , no option to pay missed payments by card, no online account option
No way of amending your bank details ! Come on. Any good revenue collector should offer this . Maybe when dvla upgrade their systems at another squillion pounds they will be able to drag themselves
out of the dark ages, and then they night be able to stop filling potholes and actually make a road for a change.

hissingsid    on 3 December 2021

Why use Direct Debit? When I receive the reminder I just renew on line.

Oldboy    on 3 December 2021

I have left the old tax discs on my cars as a reminder to me of the renewal dates.

DVLA might send me reminders, but if DVLA cock that up-it is My fault !

Mr Nexus    on 3 December 2021

Can't say I'm sympathetic. Most of our road tax probably goes on rubbish anyway.

WilliamRead    on 5 December 2021

here are allegedly thousands of ANPR camera monitoring the roads. How can untaxed vehicles evade them? No more excuses from the DVLA.

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