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Evasion of Vehicle Excise Duty increasing

Summary

This Report, ‘Evasion of Vehicle Excise Duty’ (HC 227) from the House of Commons Committee of Public Accounts, examines the circumstances of and issues surrounding the increased evasion rates for vehicle excise duty (VED).

Evasion of Vehicle Excise Duty (VED) rose to 5% (£214 million) in 2006, up from 3.6% in 2005. Amongst motorcyclists the evasion rate increased to 38% from 30% the previous year. The Driver and Vehicle Licensing Agency (DVLA), overseen by the Department for Transport, is tasked with tackling evasion. The Agency had accepted that it would not achieve its targets of reducing evasion to 2.5% by December 2007, and saving £70 million a year by the end of 2007-08.

Not licensing a vehicle and registering the keeper increasingly reflect the intention to avoid congestion charges and prevent identification of criminals, as well as the actual evasion of VED. Problems are also caused by false and foreign number plates.

This Report notes DVLA's lack of resources to undertake on-the-road enforcement. The Committee questions the effectiveness of the DVLA's current enforcement approach and whether the DVLA understands the patterns and motivations for evasion well enough to design fully effective counter-measures.

Working with partner organisations such as the Police and Local Authorities is the best way to tackle persistent offenders. In the medium term the DVLA may need to move to increasingly advanced technological solutions such as the insertion of electronic chips into number plates.

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Law-Making Explained

This is a House of Commons Paper (HC 227 2007-08): it is a Report from the House of Commons Committee of Public Accounts.

Find out more about House of Commons Papers.


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