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Guest opinion: Vertu Motors CEO on the end of the tax disc

Author: Robert Forrester, Vertu Motors' chief executive (pictured)

"October 1 is tax disc Wednesday. It marks the day when 93 years of motoring history comes to end with the abolition of the tax disc. But will it be a bad or a good thing for motorists?

In my opinion the only people to lose will be motor dealers, who often reclaim the residue of tax discs from used car trade-ins. The consumer will now automatically receive a refund from the DLA from the date they sell their car.

The winners are taxpayers, who will not need to contribute as much money to run the car registration system and motorists who will soon get used to the convenience and simplicity of a web based system in no time at all.

Of course any new system takes time to become familiar and accepted; no doubt there will be scores of media reports highlighting confusion and spreading scare stories about the possible implications of the change.

Public ignorance certainly doesn’t help.

A survey found that 50% of drivers are still in the dark about when the changes take effect. Nearly a third of them said they will not even try to find out what the new rules are, according to the poll by the price comparison website The poll found that six per cent of motorists believe that the changes are not coming into force until next year.

The move away from paper discs is designed to offer motorists more flexible payment options and make it harder for people to evade taxing their cars.

Estimates show that the changes could save the taxpayer £10 million a year.

The principle remains that car owners will still need to have paid vehicle tax to drive on the roads. Extending that principle to selling permits to foreign drivers is something that has yet to be tackled!

Under the new system, the tax will no longer be automatically transferred with a car when it is sold. Sellers are expected to tell the DVLA straight away of the change of ownership or face £1,000 fines.

Around 53 per cent of drivers said they would use the new option of paying by direct debit on a monthly basis.

Those choosing to spread the cost by paying twice a year or monthly will incur a five per cent additional charge. However, this is half of the 10 per cent surcharge currently applied to six-month tax discs, used by 23% of drivers. Motorists can also pay annually with no extra cost under the new system.

The tax refund on a sold car will be sent automatically when the DVLA receives notification that the car has been sold, scrapped, exported or taken off the road with a Statutory Off Road Notification (SORN).

The tax disc has had a good innings. More than 1.7 billion of them have been issued since 1921 and in 2013 a total of 42.2 million were issued by the DVLA.  Believe it or not tax discs can also be collectors’ items.

Most expensive vintage tax disc sold so far is from December 1921; it reached £810.30. So keep your old discs. Like a picture by a dead artist they might even grow in value, perhaps those from October 2014 will be worth something in 50 years.

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  • Mal - 17/09/2014 10:53

    The Government in the form of the DVLA will also benefit hugely, as any car sold mid month will only have complete months refunded, and the new buyer will also have to tax mid month, meaning its a double bubble for the DVLA.

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    • G60Tim - 17/09/2014 11:14

      @Mal - Hasn't that always been the case though?

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    • Mal - 17/09/2014 18:28

      @G60Tim - not in the case of a private sale, ebay, , autotrader and gumtree are full of cars with x amount of tax left on it, now as a private seller the tax will be refunded minus the current month and the new buyer will have to retax the car . .

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  • Joolz47 - 17/09/2014 13:48

    How out of date is Mr Forrester - for some time now the only person who has been able to claim back any unexpired tax has been the registered keeper. With ANPR having been in operation nationwide for some time, the disc has become redundant and the ability of dealers to tax and release cars without a disc, is a return to the speedy turn around available to dealers when they were issuing discs prior to the closure of the LVLO's. It's just a pity that the "powers that be" didn't have enough sense to make the change coincide with the change of registration to "64" plate, instead of running out of discs to issue as they have done.

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    • Mal - 17/09/2014 18:30

      @Joolz47 - not true, historically as long as the car was "in trade" and the dealer has the remainder of the V5 they could cash the tax in, which was a lucrative money earner for some dealers.

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  • joolz47 - 17/09/2014 18:56

    Show me a cashed cheque payable to anyone other than the registered keeper.

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  • JWright - 20/09/2014 08:34

    I think people who want the tax disc, should be allowed to have one, but some people like tax discs, older people want a tax disc. I'm old, and want a tax disc

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