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Wednesday, 1 October 2014

Tax discs go, but not smoothly

The BBC reports that the abolition of tax discs has led to a certain amount of confusion - occasioned by having many more people than usual trying to renew online. That was probably inevitable.

The government is also getting some stick for the "double taxation" that is an inevitable consequence of the change in the vehicle excise duty rules: when a car is sold with VED remaining on it, the buyer has to pay VED from the beginning of the month but the seller gets no refund for the month in which the sale takes place. Will car sales become concentrated at the end of the month - claim a refund on the last day, retax on the first of the next month, keep it off the road in the interim (if that is even possible for the seller)? With everything being done online these days it might be possible to do the business each side of midnight so it is almost seamless.

The government argues that the extra revenue is very small, and that 65 per cent of cars are not sold with VED on them at present anyway, but the impression that they are squeezing a few more pounds out of the milchcow cannot be ignored.

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