“A poll tax on wheels” – Edmund King president of the AA.
In what seems to be yet another indirect tax on the motorist, a number of local councils are investigating proposals to charge up to £1,000 per parking space for businesses within their catchment area.
The Workplace Parking Levy (WPL) is already in force in Nottingham, and cities such as Bristol, Cambridge and Reading, along with the London boroughs of Brent, Camden and Merton are looking to introduce similar, all under the ‘anti-pollution’ tag.
It’s true that Britain has one of the highest congestion levels in western Europe, and according to a number of government sources, it’s that which is causing the rise in pollution; slow moving traffic. Strange that The City of London Corporation is looking to slow traffic down in a bid to help the air-pollution level.
At least ten councils are considering the WPL, and in Scotland, both Edinburgh and Glasgow have made it clear that they want to introduce it, but not everyone agrees. In 2018, Greater Manchester rejected a proposal for a workplace parking levy, and just recently, Robert Halfon, Conservative chairman of the Commons education select committee branded it as madness.
“This is complete madness. It’s yet another tax on the motorist, and all it will do is hit working people with the cost of living. It’s entirely the wrong thing to do”.
Edmund King agrees: “We need incentives on electric vehicles, not a tax on work to drive businesses out of town, or out of business. Workplace parking levies could become the new poll tax on wheels”.
How it works
While there is still some debate over the final revenue structure and pricing, the expected charge is between £500 – £1,000 pa, per space, and it will only be charged to those companies with more than ten parking spaces available to their employees. Nottingham currently charges £387 pa, but around 50% of the businesses charged, pass it directly to their employee.
What isn’t clear is what would happen if all of the employees decided to use another form of transport to commute; would the business still be charged? Or how could they dispute the charge?
Since its introduction in 2012, Nottingham has raised a further £53.7 million in revenue. While some reports say that CO2 levels have fallen by as much as 33%, it’s widely accepted that this isn’t solely due to the WPL. Public transport usage is now among the highest in any UK city, but it’s also worth pointing out that Nottingham City Council is the majority shareholder of the local bus company.
Further still, there is a possibility of a conflict of interest; matched funding is a common source of income for any council, this means that councils introducing the WPL could use that as a way of generating further monies – anywhere up to £3 – £4 per £1 brought in locally, meaning that an ulterior motive may have some influence in the decision.
The true cost
A study by Centre for Cities looked at just how councils can raise further revenue, from basic taxation through to more subtle methods, such as the WPL. They go on to say that although the workplace parking levy may be less efficient at raising revenue, or even reducing congestion, a London-style congestion charge is politically more contentious and expensive to establish.
They also suggest that councils need to start thinking about new revenue streams now before the ‘traditional link between increase in road use and fuel duty revenue weakens’.
While the workplace parking levy is being considered, let’s call it what it is – a tax on the motorist – we should understand that city centre retail businesses and manufacturing / commercial businesses are already struggling under the weight of financial obligation, and in all ways, this will further that strain.
Even passing the cost on to an employee would mean a higher chance of that employee looking for work elsewhere, leading to admin, onboarding and training costs. Using Nottingham as an example, 500 companies are affected, these companies bring in £9,000,000 pa in WPL charges, or £18,000 each as an average.
While one can agree that congestion is bad, or that air-pollution levels are in need of some serious help, if we’re genuinely looking toward the green argument, then surely the way forward is to incentivise cleaner technology, not punish those that are already struggling to fund a cleaner vehicle?
What do you think of the WPL idea? Is this just another indirect tax on the motorist? Let us know in the comments.