End of the road for the car tax disc

Posted on December 5th, 2013 by James Luckhurst

Car Tax DiscFarewell to the tax disc. The little circle of paper that has graced our windscreens since 1921, and shows we have paid our excise duty, is to be replaced with an electronic system, according to Chancellor George Osborne’s Autumn Statement. The disc is no longer needed, officials say, because the DVLA and police  now rely on an electronic register. The new system will allow people to pay the charge by regular direct debit, and will save £7m in administrative costs.

The direct debit payment option will attract only a 5% surcharge, compared with a 10% supplement for buying a six-month disc.

The Treasury said it showed government was moving “into the modern age” and it would also make “dealing with government more hassle free”, according to spokesman.

The changes are expected to come into effect in October 2014.

Vehicle tax was introduced in the 1888 Budget and the system of excise duty applying specifically to motor vehicles was introduced with the Roads Act 1920, with the tax disc appearing the following year.

This is an extract from Hansard, the official parliamentary record, of discussions in 1888 regarding vehicle tax:

Chancellor George Goschen: Apart from the Carriage Tax, which is a tax mainly on the more luxurious carriages – carriages, used for pleasure – there is at present no tax on any other vehicles, however much they may destroy the roads. We propose to put a duty of £1 a-year upon every vehicle exceeding 10 cwt. in weight, a very moderate limit to take. Members will acknowledge that the principle that all those who use the roads should pay for them, and should pay in some proportion to the wear and tear that they cause, is just. But I have not yet exhausted the subject. We propose, also, to put a very small Wheel Tax upon every vehicle.

Colonel Nolan, MP for Galway North: Not on carts?

Chancellor Goschen: Yes. We propose a duty of 2s. 6d. per wheel upon all carts over 2 cwt.

Colonel Nolan: Oh!