M6 Toll - Business Logic

[Tyson]

Research, Developement, Investment............Look what happened to our car industry......Same as most things in this country....

[Fat Albert]

Compared to say, smokers, road users have been treated with contempt by successive governments

                               Tobacco Net     Net Revenue   Tobacco Users
       Pack of 20    Sales    Tax Revenue  Fraction Sales  Net % Tax Hike
1997         £2.42     84bn         £9.8bn          0.1167  
2011         £6.63   58.5bn        £10.5bn          0.1795          153.8%

                            Road User Net     Net Revenue      Road Users
   Litre Unleaded    Sales    Tax Revenue  Fraction Sales  Net % Tax Hike
1997         £0.61   29.5bn          £11bn          0.3729
2011         £1.31   23.2bn        £33.6bn          1.4485          388.4%

Road users have seen their net tax payments rise 3.8 times compared to smokers 1.5 times

Yes that's right, UK governments have raised tax on road users by more 380% in 14 years

If any other tax had been raised by the same punitive amount, at worst there would have been a change of government, at best the mutilated bodies of politicians would litter Westminster

Why have we let them get away with it?

[dombanks]

Norman is there an alternative rather than the motorway? i wouldnt mind using the toll if i thought it was worth it but as there is a the m6 normal road then its not.

road pricing here would be off the scale and would just force people off the motorways.

Using the toll's pricing (5.50 ofr 46km) your 500Km journey would cost £59.78

tyson, i dont quite get the car insdustry thing. we have one of the best in the world it seems. At the mo the good news i hear is ususally some car company keeping its manufacturing or bringing more here as we are so good. Aparently for GM the ellesmere port plant is considerably more productive than the germans.

[XTR2Turbo]

Smoking vs Petrol data looks somewhat flawed to me.

It mainly shows that smoking has massively declined.

Taxes on cigarettes and alcohol have increased far more compared to fuel.

Fuel commodity prices has driven much of the increase in fuel price and tax take.

I think that the fuel tax take is forecast to decline this year due to less car use, improved economy.

Have you not seen that the forcast is for a massive drop in fuel tax revenue over the next 20 years which is why the government will be looking at road charging schemes.

[XTR2Turbo]

The toll that annoys me most is the Dartford crossing. The delays it introduces in both directions are madness.

[Ciprian]

its not necesarly a bad idea to increase the price, in some cases, they could me making more money. it really depends on how much the number of payers will drop.

[Tyson]

tyson, i dont quite get the car insdustry thing. we have one of the best in the world it seems. At the mo the good news i hear is ususally some car company keeping its manufacturing or bringing more here as we are so good. Aparently for GM the ellesmere port plant is considerably more productive than the germans.

dombanks......

Sorry what i should have said was, we do not build our own cars e.g BMWs, Mercs, Audis VW - Germany...GM - USA...Toyota, Japan, etc.

I understand that we build other countries cars in the UK but that is down to a number of things, costs,volume per man, goverment subsidies for land etc. We should be buiding our own cars and not relying on other countries.

We also have some of the best engineers in the World in the Uk, just look at F1.

Serious lack of future investment, for research and developement.

[Fat Albert]

XTR Turbo

Your analysis is flawed, the NET tax take from road users has increased almost four times in 14 years while the cost of a refined litre of fuel has increased only twice!, while our government has spent less on the road system. It's not just petrol, but diesel (Britain has the highest fuel duty in Europe), VED which has been punitively raised using the risible excuse of CO2 warming, MOT charges, Congestion charges, VAT on the whole lot plus VAT on new vehicles which, of course, have much higher MPG and therefore reduce fuel usage.

Smokers have an option, they can choose not to smoke and as a result inconvenience themselves, most car use is work or social related, reducing usage affects others such as family. There are alternatives to increased taxation, our leaders willfully refuse to consider them because this way they get an ever increasing slice of our income which they choose how to spend.

[Norman Verona]

Dom, yes there is an alternative, the "D" roads. But it would take twice as long.

Because France is so much larger than the UK (3 times) car use over long distances is not normal. The trains are heavily subsidised and most would travel by TGV.

I can get a ticket from Rennes to Paris by TGV for about 30€ each and it takes 88 minutes.

Just for clarification, the motorways are "A" - Autoroute,"N" - National roads are funded by central government, the "D" roads are funded by the Department and the "C" roads are funded by the Commune (local village). The classification has nothing to do with the size of the road, a "D" road can be a super dual carriageway or a little back lane. Likewise an "N" road can be a dual carriageway or a single lane road. Also don't rely on the road numbers. this week a road may be the N197 and next week it will become the D997, as the responsibility for funding changes.

Surely the flaw in Albert's table is the price of the raw material. Oil has risen in price far more than inflation and tobacco has probably gone down in real terms. It also ignores the price of the Road Fund Licence (so why toll roads?). I remember taxing new cars for £17.50 in the 70s. How much now? France abandoned its RFL when the Insurance database started. It was only used for tracing owners and it wasn't seen as a tax raising charge, just covering costs. We still have to register our vehicles on acquisition but it's a one-off charge, not annual.

ed to add - MUST TYPE FASTER! Took me so long (reading emails whilst composing) that two other posts appeared.

I didn't mention MOT charges as they do not contribute to tax. MOTs do attract VAT, they are "outside the scope" of VAT, whatever that means. The charge for a French MOT (CT) is about the same but does attract VAT (TVA).

I'm not sure if the option to smoke or own a car is an issue here. The point is that the UK subjects pay enough in tax not to have to pay to use roads. Of course there is always the argument if the motoring taxes were reduced something else would have to go up.

It's also not worth complaining because, as far as I can see there is no alternative political party to vote for - they're all the same.

[jeff oakley]

The Dartford crossing is just a rip off and as someone said just causes severe delays. The M6 toll in principle was okay but is too expensive and it is a sign of things to come. Motorists are cash cows and we fall for it as we have no alternative. Electric cars were exempt from tax for those with company cars, now it is 13% on cars with a cost price of at least a third more than a normal version. Low emmissions cars were taken up in big numbers because the tax was nil or low and surprise suprise there is not enough money coming in and road charging raises it's head again. In France there are alternatives that work but over here there none as every alternative ends up in a town or village.

Everyone knows that we need money to pay for essentila service but too much goes to EU, Forgien aid, benefits for the wrong people. As Norn says they are all the same but some are slightly worse than others.

[pistonbroke]

So the M6 Toll lost £41m last year due to a lack of traffic, which has been steadily going down since it opened.

So they need either 41 million drivers to pay £1 per car

Or

1 driver to pay £41 million pounds

which do you think is the most likely ?

[Norman Verona]

If we played the game right we could have as much back as we pay into Europe. But as usual we don't understand the rules. Every directive sees us employing thousands of civil servants to police the new rules whilst every other country ignore it.

Back to car tax.

I believe that something is worth what people are prepared to pay. In non fashion items this depends on the benefit it brings. As far as the Dartford crossing is concerned you can turn off and drive into London, cross the first bridge (or is it the Blackwall tunnel) for free and then make your way back to the M25.

I'm happy to pay the 1.50.

As far as Government sponsored fraud is concerned how about telling us all it was cleaner to drive Diesel cars and then, when a lot of people changed raising the duty on Diesel so it's now dearer than petrol. In France it's the other way round, petrol is dearer.

On the subject of tax and UK vs France I was explaining to a tax officer that in the UK retirement ages are 60 and 65 (or were). She chuckled and said they wouldn't get away with that in France. Attitudes - The French government realise they are the publics servants and raise tax for the publics benefit.

[Norman Verona]

Bernie, you left out the most likely solution.

The government pays the 41 million so we all pay, car owners and non-car owners alike.

[pistonbroke]

To true Norm , we just bend over

[GreigM]

what I want to know is why it takes anywhere near the amount of cash to "run" the M6 toll as it does.....what exactly are they doing with the money - in 2005 they reported it took £11.4M to run the road, so how the feck do you turn that into a £41M loss without gross mismanagement.

And even at £11.4M to run....why does it take a quarter of a million per mile to run...for the little traffic it seems an extraordinary figure.