The government must overhaul motoring taxes as it phases out new diesel and petrol vehicles, according to MPs.

MPs on the Transport Committee say the government must come up with new policy options by the end of the year. A ban on the sale of new diesel and petrol vehicles will be introduced by 2030, which means £35 billion will be lost in tax revenue.

In a report entitled Road Pricing, the Committee favoured a road charging system based on technology which measures road use.

Any scheme would include the drivers of electric vehicles, who would be required to pay for road usage. It would also cover vans and HGV vehicles, as well as overseas vehicle drivers.

Huw Merriman MP, Chair of the Transport Committee, said:

‘We need to talk about road pricing. Innovative technology could deliver a national road-pricing scheme which prices up a journey based on the amount of road, and type of vehicle, used. Just like our current motoring taxes but, by using price as a lever, we can offer better prices at less congested times and have technology compare these directly to public transport alternatives.

‘By offering choice, we can deliver for the driver and for the environment. Road pricing should not cost motorists more, overall, or undermine progress on active travel. Work should begin without delay. The situation is urgent. New taxes, which rely on new technology, take years to introduce.

‘A national scheme would avoid a confusing and potentially unfair and contradictory patchwork of local schemes but would be impossible to deliver if this patchwork becomes too vast. The countdown to net zero has begun. Net zero emissions should not mean zero tax revenue.’

Internet link: Parliament website

HMRC has revealed that more than one million taxpayers filed their late tax returns in February – taking advantage of the extra time to complete their self assessment without facing a penalty.

About 12.2 million taxpayers were expected to file a return for the 2020/21 tax year and more than 11.3 million submitted their returns by 28 February.

The deadline for submitting tax returns was 31 January but, this year, HMRC gave customers an extra month to complete it. If customers filed their returns in February, they would avoid a late filing penalty.

HMRC has given customers until 1 April to pay their outstanding tax bill or set up a Time to Pay arrangement to avoid receiving a late payment penalty. Interest has been applied to all outstanding balances since 1 February.

Lucy Frazer, Financial Secretary to the Treasury, said:

‘[The] stats show how vital the extra month was in supporting the cash flows of more than a million self-employed people and businesses across the UK, helping to ensure their survival as we recover from the pandemic.’

Internet link: HMRC press release

The British Chambers of Commerce (BCC) has called for urgent action to help improve trade with the EU.

A survey carried out by the BCC revealed that 60% of UK exporters reported difficulties trading with the EU. The business group said the number of lorries waiting to get into the port of Dover ‘also offers a vivid illustration of the problems continuing to impact the operation of the trade deal between the UK and the EU’.

The BCC has outlined a series of recommendations designed to help improve trade between the UK and the EU. The recommendations include supplementary deals to reduce complexity around food exports, exempting smallest firms from having to have multiple country VAT registration for online selling and a more pragmatic approach to be taken to the enforcement of import customs declarations.

William Bain, Head of Trade Policy at the BCC, said:

‘No-one is expecting goods to flow as freely across the channel now as they did prior to Brexit. But the way the trade agreement is being interpreted in 27 different EU countries is a major headache for UK business – especially smaller firms without the cash reserves to set up new EU-based arrangements.’

Internet link: BCC press release

Reports of scam HMRC phone calls have fallen by 97% over the last 12 months, according to the latest figures from the tax authority.

According to HMRC, reports of scammers impersonating HMRC in phone calls peaked at 79,477 in March 2021 and fell to just 2,491 in December 2021.

The fall in scam call reports to HMRC has also been seen elsewhere with a 92% drop in phishing email reports and a 97% drop in scam text reports over the last year.

This signals that the public is more aware of cyber criminals and the methods they use to trick people.

Mike Fell, HMRC’s Head of Cyber Security Operations, said:

‘We work incredibly hard to protect the public from these criminals who ruin lives by stealing from people. It’s great news that fewer people are receiving and reporting these attempted frauds, but it is still important they continue to report suspicious contact to us.

‘We will continue to do everything we can to protect the public from these cynical attempts to impersonate HMRC to steal from people.’

Internet link: HMRC press release

Creating an official digital currency in the UK could pose significant risks to the financial stability of banks, a House of Lords committee has warned.

The Lords Economic Affairs Committee said introducing a Central Banking Digital Currency (CBDC) ‘would have far-reaching consequences for households, businesses and the monetary system‘.

The committee made its conclusions after hearing testimony from witnesses, including the Bank of England’s Governor, Andrew Bailey; his deputy Sir John Cunliffe; Economic Secretary to the Treasury, John Glen; and senior Treasury official Charles Roxburgh.

Lord Forsyth of Drumlean, Chair of the House of Lords Economic Affairs Committee, said:

‘These risks include state surveillance of people’s spending choices, financial instability as people convert bank deposits to CBDC during periods of economic stress, an increase in central bank power without sufficient scrutiny, and the creation of a centralised point of failure that would be a target for hostile nation-state or criminal actors.’

Internet link: Parliament website