Parking mad: lose the levy

by Harry Fone, grassroots campaign manager at the TaxPayers' Alliance

Coronavirus calls for cars 

The coronavirus crisis has profoundly disrupted our day-to-day lives, with daily routines - like commuting - transformed. Many have been able to work from home, but those who can’t were told by the Prime Minister Boris Johnson to travel, where possible, using their cars rather than public transport. It’s desirable for people to use their cars over trains and buses, because people remaining self-isolated in vehicles dramatically reduces the chance of the virus spreading. But government-endorsed car travel marks a sea change from the apparent anti-motoring stance of successive governments. As such, despite the newfound government fondness for car travel, a whole range of measures remain in place which make driving more expensive.

Local authorities have previously slapped all sorts of stealth taxes on already hard-pressed motorists. London introduced the Congestion Charge and then the enterprise-draining Ultra Low Emission Zone - or, as we dubbed it, Sadiq’s van tax. Other cities are following in their footsteps, even if some have reconsidered after TaxPayers’ Alliance opposition. Sensibly, some of these measures were paused when the coronavirus lockdown was introduced. But remarkably, despite social distancing measures remaining very much in place, last month the Mayor of London reintroduced the Congestion Charge and it will actually be both raised in cost and expanded in scope from June 22nd. 

The new normal? Workplace parking levies

Even more concerning is the latest local government idea for squeezing more out of motorists - a workplace parking levy (WPL). The concept is that employers who provide parking spaces to their employees should be taxed for encouraging more cars on the road. Often, firms will pass the costs onto staff, who can end up paying more than £400 per year just to park at their place of work. 

This is especially true north of Hadrian’s wall. In October, the Scottish government gave councils the authority to implement WPLs. In truth, WPLs are a poorly designed and ultimately damaging new tax, aimed at raising revenue. It is therefore good news that the Confederation of British Industry (CBI) in Scotland is demanding a u-turn. CBI chief Tracy Black urged Scottish councils to scrap plans for WPLs, saying:

“... it would be a relief to many businesses and send a positive message about Scotland as a place to live, work and to do business. We already know the levy could have many unintended consequences for firms and individuals.”

Hear! Hear! The TaxPayers’ Alliance has repeatedly campaigned against and successfully defeated parking levies. Councils are far too quick to slap taxes on motorists rather than exploring better congestion solutions,  like improving road junctions. Local authorities often cite air pollution as a justification for hiking taxes on drivers. That’s a noble aim, but has become a catch-all excuse for councils who are actually more interested in raising revenue. The fact is air quality levels have been improving for years, and what evidence there is suggests that these interventions make only a small difference to air quality. But schemes like ULEZ hit people who are financially dependent on their vehicles - such as sole traders and van drivers - very hard indeed. 

And the truth is that vehicles are essential for the vast majority of the population For many, a car is essential for doing the school run or the weekly shop, especially for those who live outside of a city. Little wonder then, that 83 per cent of passenger mileage in Great Britain for 2018 was made by cars, vans and taxis. Councils are unlikely to stop us driving, which makes WPLs nothing more than revenue raisers. We estimated that rehashed plans for a levy in Bristol would add £20.8 million to the council’s coffers

The implications are much broader too. Cities that adopt these levies send a clear message that they are not open for business. A representative of a large firm in Bristol told the TPA that they are considering moving out of the area to avoid any potential charge. Others will likely follow suit, taking the economic boost they bring the city with them. Again, very few people disagree that we as a society should be moving to greener forms of transport. Politicians feel that strongly and argue there is much to be gained. But until there are enough economically viable alternatives to cars, it’s businesses and ordinary taxpayers who are being expected to take the pain.   

Those same politicians are saying that in the current circumstances, people should be using cars over public transport for the sake of the nation’s health. So motorists shouldn’t be punished for doing the right thing. Businesses, and therefore their employees and customers, already pay massive taxes and face an extraordinary range of regulatory burdens. Imposing a parking tax will not solve congestion problems, but it will add to the massive tax burden and undermine enterprise. Right now, councils that are considering a WPL should simply park the idea. 

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