MOTOR TAXATION AND ROAD USER.
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Why Taxation Should be Based not on Road Maintenance but on the Need to Improve Transport Economy and Efficiency. A SuggeAed Tax of a Fixed Rate per Ton.
By " Vectis."
ikGOOD MANY people just now are trying to oblige the Chaacellor of the Exchequer by thinking out practical alternatives to the petrol tax. Practically all of them appear to have run up against one very serious stumbling block. It is generally assumed that taxation must be made proportionate to user of the road a,nd, on this assumption, we are driven back inevitably upon the petrol tax. Read user must take into account the weight and the speed of the vehicle, the nature of its tyres and the mileage covered by it in the course of the year. The petrol tax, more or less, reflects every one of these factors and certainly works out as directly proportionate to the last named.
The only alternative which could apparently be considered from this point of view would be a tax on tyres, and this would only become practicable if the use of metal tyres were prohibited altogether and the choice limited to some form of rubber tyre, solid or pneumatic. Thus, by starting with the assumption that the only practical method of taxation is one that imposes annual payments proportional to the use made of the roadway, we are led to the conclusion, almost before we have begun our investigation, that it is a, matter of petrol tax or nothing. We can hardly hope for the latter and, therefore, we must stick to the former.
I have written on previous occasions on the subject of the basis of taxation, and it may be that some patient reader will presently come to the conclusion that I am contradicting myself. To be literally accurate, I am admitting to a change of opinion. I am convinced that, from now onwards, it is not only unnecessary, but it is actually undesirable, that, so far as commercial vehicles are concerned, the burden of taxation should be proportionate to the use made of the road. This, I suppose, will be regarded as o, very unorthodox statement, which it probably is. I will, however, try to justify my change of opinion, which I contend is only the logical consequence of a change of circumstances.
Hitherto, the cost of road repair has been borne wholly by local bodies. It was necessary to take this fact into account in arranging the taxation of motor vehicles. Consequently., though a, central fund was established, it was the duty of those who dispensed this fund to dole it out to local authorities in return for their undertaking to spend money of their own upon the local roads: The basis of the whole arrangement was that the proceeds of taxation should go to the maintenance of roads, and this theory was accepted generally by motor users, because they felt that its adoption would give them a kind of prescriptive right to the use of the road.
The point to be noted is that road maintenance, or improvement, was regarded as the one and only pur. pose to which the proceeds of motor taxation should be put. The road and the vehicle were in a sense considered to be mutually antagonistic, or at any rate, the vehicle was considered to be an enemy of the road, which was merely a Sort of passive resister and must be compensated for remaining passive.
Now, it seems, to me that the formation of the Ministry of Transport is an event which calls upon us ti:') take a, broader view. We may still rightly maintain that the proceeds of meth/ taxation she only be used for a certain specific) object, but it seems to me that the exact nature of that object has changed. From now onwards, we •ghould talk less of B32 economy in road maintenance or expenditure on road improvement and more of economy in transport and expenditure for theimprovement of transport efficiency. . Personally, I should be perfectly contented with a, firm assurance that the Proceeds of all motor taxation would go towards the constructive and progressive work done by the efficient Road Department of a capable and dependable Ministry of Transport. To put the thing in another way, what we really want is a recognition of our right to exist and a recognition that motor vehicles should not be taxed except for the purpose of creating a fund to be used so as to make the operation of motor vehicles cheaper and easier. If a capable central authority can collect 210 a year from each of us, and, with the fund thus formed, can carry otit work that will save us each 220 a year, then. we need have no objection to paying the £10. • I take it that the object of the Ministry of Transport is to increase the wealth of the country by improving its means of communication. If it succeeds, then every member of the community will benefit, Probably those who actually own and operate vehicles will benefit more than others. Therefore, it seems.to me that some of the money which has to be spent should be the proceeds of general taxation and some of it should be the proceeds of special taxation of the vehicles which use the roads. This would make things fairer all down the line. There is, for instanee, no reason why the man who never travels on a motor bus should be asked to'pay any considerable part of the fare of the man who does travel. By taxing the vehicle,, the passenger is really made to pay more towards the creation of the road to carry that vehicle than does the man who is not a passenger. I hope I have made it clear that my conclusion is that the proceeds of taxation should go to secure efficiency and economy of road transport generally. They should be used probably for road improvement, but not necessarily for that purpose, if it turns out that there are other things that can be done that are likely to be even more beneficial to transport develop. meat. If this theory be accepted, we give up the idea that taxation should be specifically for road improvement and should, therefore, be based on the use made of the road, and we replace it by the idea that taxation should be specifically for improvement in trans:port economy, and efficiency, and should, therefore, be such as to encourage economy and efficiency in the use Of' vehicles. . Now take two cases: one of a' man who Owes a three ton vehicle and uses it :regularly to Carry a three-ton load over 70 miles, in the day—this 'man is making full use of his vehicle: ...the second of a man who owns an identical vehicle and use's it to carry about one ton 20 miles in the day--tlaia man is using• his vehicle inefficiently. The second man is eontri}Ailing as much to traffic congestion as if heecarried his full load 20 miles a day. He is wasting our road space and should be penalized for doing so, particularly as, in very many 'cities, we have none Oh ranch road space at our disposal., ,Again, the second man, by running a short mileage with. a small lead, is working under eenditions which mean a high cost per ton mile. This cost must be reflected in the ultimate price of the goods 'Carried. The driver of this second man's vehicle is not being employed efficiently. He is only doing about a. tenth of the. usefulwork that he could do comfortably. in the day-20 ton miles as against 210 ton reilee. Now, we know that the secret of industrial efficiency is the enlargement of the output of the individual by providing him with the most modern tools possible and seeing that he uses them to their fill advantage. Very properly we grumble if he refuses to do so, and we talk about the fatal fallacy of restriction of output. If the working man is wrong in restricting his own output, we are equally wrong in restricting it for him. We ought not to use a man to do 20 ton miles when be is capable of doing 200 or More. If we use him in this way, we really deserve to be fined for reducing the aggregate output capacity of the nation.
From all this it seems to me quite clear that the man who uses his vehicle to its full capacity of load and mileage deserves encouragement as against the man who uses his vehicle much below its full capacity. Therefore, I maintain it is wrong to make the tax on the vehicle proportionate to its user of the road. It would be more beneficial to progress if we make it inversely proportional, taxing most heavily the vehicle that is used least.
I do not seriously suggest going to this extreme,' partly because any such scheme would be unwork able. I do, however, seriously suggest that we should not allow mileage to enter into the taxation of commercial vehicles, but should base this taxation solely on the maximum legal laden weight. If the vehicle owner failed to work up to this maximum whenever possible he would automatically be made to pay a correspondingly high tax per ton carried. Meanwhile, assuming equal loads, the tax payable per ton mile would be inversely proportionate to the mileage covered. The encouragement would then be all in the direction of making the fullest possible use of any vehicle and reducing unnecessary obstruction caused by redundant duplication of services and lack of interest in the possibility of obtaining return loads.
Similarly, under my scheme we should, 1 think, he encouraging the types of vehicle which would de • serve encouragement. If we take two vehicles having the same maximum laden weight, but one fitted with rubber tyres and the other with metal tyres, any reasonable law is certain to allow a higher speed to the former. Its mileage in the year will, therefore, be greater, whereas its useful load and the tax paid upon it will be the same as the load and tax of the slower vehicle. It follows that the tax paid per ton mile will be inversely proportional to the average speed. The higher the speed the lower the tax per ton mile. The use of vehicles of high speed up to the limits permitted by the la* would,therefore, be encouraged, and it is to be noted that we get the same occupation of the road debited against two vehicles, each on the road for eight hours of the day, even though one goes further than the other. Actually the obstruction caused is greater for the slower vehicle, because this is more likely to impede traffic coming up behind it.
I propose, therefore, that in future the taxation of all commercial vehicles should be based on a fixed rate per ton of maximum legal laden weight. I do not think it would matter much if the basis were made the legal .unlaelen weight. In fact, this might operate better, because, of two vehicles designed to tome within a certain limit of total laden weight, the lighter would pay the lower tax and would also be the one to carry the greater useful load, on account of which it is the more desirable traffic unit.
I fully recognize the weak spot in my system. It is devised primarily for the commercial vehicle. It does not apply so equitably to the private ear. I agree that it would not really be fair to abolish the petrol tax on private cars and to substitute a tax based solely on power or weight. This would mean that the tax paid per mile by a worker who, perhaps, can only go motoring at week-ends, would be much higher than that paid by a rich and idle man who can use his car every day of the year. This objection might be partially overcome by basing the tax on private cars and motorcycles on some simple formula of horse-power and making the scale such as to have a very sharp incline.
What I mean by this is that the low-powered car, which is probably the one selected by the man of moderate means and little leisure, would pay quite a small amount, whereas the high-powered car, probably chosen by the rich and leisured man, would pay very highly indeed. I would not for a moment suggest basing the tax upon the price of the car, because this would be all up against my theory that economy should be encouraged. The man who pays more in the first instance is quite likely to be the less extravagant inasmuch as the reason for his expenditure is that he expects to get a vehicle which will last him much longer.
I am, however, not professing to deal fully at the moment with the entire problem of motor taxation, hut only with the taxation of commercial motor vehicles. Incidentally, my scheme would get over any difficulties of unfairness as between petrol vehicles and those employing solid fuels either directly or indirectly. It would get rid of the complication of 50 per cent, rebates. If the petrol tax were still retained for private cars and motorcycles, its collection would be to that extent simplified and an opportunity would remain for giving preferential treatment to home or Empire produced fuels. If private ears were taxed on power and the petrol tax done away with altogether, no such encouragement of the home-produced fuel could be afforded.