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New tax discs result in "double money"


The government could receive extra revenue from motorists in the new car tax system, the AA has advised.

The old paper car tax disc will become obsolete from today, and the AA (Automobile Association), a British motoring association, has found that the new electronic tax disc system may enable the government to get “double money” from drivers. For example, someone selling a car during the month will not be able to get a refund for the rest of that month, even though buyers will need to renew the tax immediately. So if a car is sold on the first day of the month, both buyer and seller will have paid the tax for that month.

The Driver and Vehicle Licensing Agency (DVLA) said it would not bring in much additional revenue.

From today drivers will no longer have to display a vehicle excise duty (VED) disc on their screens, and will now renew the tax electronically online or in the post office. The Government says this change will eventually save the Driver and Vehicle Licensing Agency (DVLA) about £7 million a year.

AA president Edmund King said: "This is a downside to the changes as it means someone driving a car that costs £500 a year to tax would lose £41 if they sold it at the beginning of the month. Likewise a buyer purchasing a car mid-month would have to pay VED for the entire month.

"There are also potential issues for our patrols towing a vehicle which they will not know immediately if it is taxed. Likewise if a vehicle appears to have been dumped on the roadside the lack of a valid tax disc is often an indication that this is the case."

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