London’s CO2-based congestion charge could raise £172m extra a year
21 August 2007

The swingeing £25 London Congestion Charge for cars in tax band G could raise a staggering £250m a year, according to an estimate by Autocar.London mayor Ken Livingstone is currently “consulting” on the proposal to hit drivers of cars over 225g/km with the £25 charge, while allowing cars below 120g/km to enter the zone for free. Autocar’s estimate is based on figures supplied by Transport for London, which estimates 15 per cent of cars in the zone today are in VED tax band G, the equivalent of about 40,000 cars a day. When each one pays £25, that will raise £253m in a year, of course providing the charge doesn’t deter them.Overall the extra revenue flowing into TfL’s coffers could be as high as £172m, the difference between today’s £8 charge and the proposed £25. Alone that would be enough to pay for the scheme’s running costs, last year £156m. And the true potential for revenue raising from the proposed change could be much higher, according to figures from the car-makers body, the SMMT. These show that 173,237 band G cars are currently registered in Greater London — the area inside the M25. Older models with engines over 3.0-litres number 68,442.

TfL: “no comment”

TFL won’t comment on Autocar’s estimates: “It’s very hard to comment on these figures because we don’t know how the charge will change driver’s habits,” they told us.Any increase from band G cars will have to compensate for revenue lost to zero-rated band A and B cars. TFL estimates about one per cent of vehicles in the zone would currently qualify for the exemption; at that rate, the change will cost TfL around £5.5mil a year. However, with an increasing number of models being offered now that emit less than 120g/km of CO2, that figure can only rise.

Julian Rendell

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