"Double Tax" Windfall Nets Government an Extra £38m

By Gary Cutlack on at

The AA has conducted a survey of drivers in which it asked them about the changes to the UK's vehicle tax rules, finding that 60 per cent had no idea tax now expires when a vehicle changes hands and that some families are actually paying to tax cars twice.

The motoring organisation says that one big flaw in the system kicks in when a car is transferred between family members, say when Dad donates his battered motor to Mum so he can have something newer and better and with Bluetooth for his music. The fact that Dad's tax auto-expires when the vehicle is transferred and full months aren't refunded means Mum then has to pay tax again -- so the family is effectively paying two lots of car tax for the month.

The AA says this rule applying to families and all used car sales could've bagged the DVLA an extra £38m in cancelled leftover month double-taxes. It also asked drivers what they know about the rule changes, and found that vast numbers still seem to be completely unaware that the car tax system has been reworked. 51 per cent of people polled didn't know tax couldn't be passed on when a car is sold, while 60 per cent had no idea tax was automatically cancelled when a car was sold.

AA boss Edmund King said: "October's abolition of the vehicle tax disc and a new process for transferring a vehicle's 'keeper' is a massive change after 90 years of the old and familiar system. We are particularly disappointed that there was not an equally massive communications campaign to ensure the UK's 35 million drivers got the message." [Standard]