CONSULTATION ON REFORM
OF VEHICLE EXCISE DUTY FOR LORRIES
1.1 The Government published its ten-year plan for transport, Transport
2000 – The Ten Year Plan, in July 2000. It set out the Government’s long-term
strategy for delivering a quicker, safer, more punctual and environmentally
friendly transport system.
1.2 Lorries are a significant source of: a. Greenhouse gas emissions,
which cause climate change; b. Local air pollutants, which can damage
health and make life in towns and cities unpleasant; c. Track cost, which
increases the cost of maintaining the road network; and d. Noise, which
can be intrusive.
1.3 The Government believes that tax can and should be used to promote
environmental objectives. However, the Government believes that this must
be done in a fair way and in a manner that does not hinder UK businesses’
international competitiveness. The Government’s position towards environmental
taxes was set out in more detail in its Statement of Intent on Environmental
Taxation, published in July 1997. This is summarised in section 2.
1.4 In Budget 98, the Chancellor announced a review of the existing system
of Vehicle Excise Duty (VED) for lorries. To inform this review, the Government
commissioned the National Economic Research Associates, AEA Technology
and The Transport Research Laboratory to produce a report on lorry track
and environmental costs (referred to as the NERA report). This report
was published in April 2000.
1.5 The Government has considered the NERA report and has listened to
the haulage industry both in the Road Haulage Forum and in bilateral meetings.
The Government greatly values the dialogue it has established with the
haulage industry and hopes that it will continue during and beyond this
1.6 The purpose of this document is to allow all interested parties to
comment on the proposals to reform lorry VED set out over the following
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CONSULTATION ON REFORM OF VEHICLE EXCISE
DUTY FOR LORRIES