Vehicle tax collected fell £200m after paper discs axed

The amount of vehicle excise duty collected from motorists fell by more than £200m in the six months after the tax disc was abolished, figures show.

The data, obtained by the Financial Times, showed £2.7bn was collected in the six months after an online system was introduced in October 2014.

Critics had warned the change would lead to confusion among motorists.

The National Audit Office said the change had likely caused "an initial increase" in non-payment.

But it added that "overall non-compliance remains very low".

The figures obtained from the Driver and Vehicle Licensing Agency (DVLA) show that between October 2014 and March 2015 some £2.7bn was collected in vehicle tax - £223m lower than the same period a year earlier.

Since the paper tax disc was abolished, authorities have been using a network of cameras linked to a database to work out which vehicles are being driven illegally.

Luke Bosdet from the AA said motorists were often caught out after changing address or not updating who is the registered keeper of a vehicle, meaning they missed any reminders from the DVLA.

"It's not surprising payments have fallen and ironically the change was supposed to save money.

"It looks like it will work itself out but there are still many people who are not familiar with the new system."

DVLA chief executive Oliver Morley said almost 99% of all vehicles on the road were taxed.

"That's around £6bn in vehicle tax passed to the Treasury every year," he said.

"We write to every registered vehicle keeper in the UK to remind them when their tax is due and we have introduced a range of measures to make vehicle tax easy to pay, such as direct debit or online.

"At the same time we are taking action against those who are determined to break the law."