Vehicle Excise Duty – Taxis
Letter to:
Rt Hon John Hayes MP
Minister of State for Transport Legislation and Maritime
Rt Hon Mel Stride MP
Financial Secretary to the Treasury
Vehicle Excise Duty – Taxis
The Mayor of London requires all new taxis to be Zero Emission Capable (ZEC) from January 2018. This is part of his bid to clean up London’s air and I fully support this.
I have been informed by the Licensed Taxi Drivers’ Association that the current Vehicle Excise Duty (VED) rates, introduced on 1 April 2017, will disproportionately disadvantage taxi drivers purchasing new ZEC vehicles above the list price £40,000. There is only one model available for Hackney Carriage drivers, and that’s the TX electric taxi, priced at £55,599.
Whilst only ZEC vehicles will remain tax-free under the current Vehicle Excise Duty (VED) rates, cars with a list price above £40,000 will be required to pay an extra £310 every year after the first year for the first five years. Therefore electric cars over £40k will pay £310, alternative fuel vehicles will pay £440, and petrol or diesel cars will pay £450 per year. After five years, these rates change to zero, £130 and £140 respectively.
This means that taxi drivers will be expected to pay an additional £1,550 over the next five years, because the vehicle available to them is over £40,000 - effectively cancelling out support that they are expecting to receive from Transport for London and the Government’s Office for Low Emission Vehicles.
I strongly urge you to review this, and look at an exemption for London taxis.
Yours sincerely,
Caroline Russell