Over the last five years, London Mayor Ken Livingstone has been the paterfamilias of the UK's anti-car jihad. Spearheading this effort: London's congestion charge (CC), a £5/day daily toll to drive into the central parts of the City. Amid charges that the CC is ineffective and inefficient, emboldened by talk of global warming, Ken's upped the stakes. Literally. The Times reports that the daily CC is about to ascend to a whopping £25/day (50 bucks to us Yankees). At the same time, "Red Ken" is closing CC loopholes. The hybrid exemption will expire in 2010 (which is about seven years too late for Lexus's LS600h). But the part that really sticks it in and breaks it off is that London is ditching the exemption for people that live inside the zone. Right now they're paying a reduced rate of 80p/day. Residents within the large Congestion Charge Zone will now have to pay a cruel £6000 per year. Cars that emit less CO2 will still be exempt, which is nice. Mr. Mayor says the estimated £30 – £50m in "extra" revenue generated by the modified scheme will pay for new mass transit systems. And if you believe that, you'll believe Ken doesn't secretly want to ban private passenger cars from the inner city.
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They’re also supposed to use the money to buy 6,000 rental bicycles. In London, England.
What are they smoking?
Oh yeah, that revenue will be directed straight away to mass transit. Just like the gasoline taxes. It’s a peculiarity because they are dependent on the revenue yet hate cars and those who don’t submit to the hand. Just like tobacco taxes.
New York is watching carefully, as Bloomberg fancies himself a student of what London does.
At the end of the day they get the rulers they vote for. Obviously these people are not afraid of losing their jobs so the screws get tightened.
“What are they smoking?”
Nothing. We’ve also got a smoking ban in public places! First it’s no smoking, then no drinking, no swearing and finally no talking!
Top Gear recently revealed that there’s a loophole which Mr Livingstone CANNOT close down. They found out that a couple of Bentleys were registered as taxis, but they couldn’t find them for service in London. It turned out that the owners registered their luxury cars (I’m sure an Aston Martin was registered too) as taxis, which made them exempt from congestion charge and as a private business they could take on any level of business they wanted (i.e no-one)! Quite a masterstroke, I thought……
the stolen license plate game is another problem. Someone recently made a plate that matches Livingston’s and displayed it for the cameras. Imagine getting bills past due for thousands of dollars because someone cloned your plate and drives the same color and model of car you do. Everytime you move your car the plate is exposed for all to see.
See what happens when you let the government stick their hand in your pocket?
Quasimodo, I think the goverment’s hand is way beyond the pocket in this case.
Hello, who is forcing the zone residents to pay anything? They can (a) not drive every day, or (b) not drive at all. Besides, call me crazy, but if you can afford to live in the center of a major city AND can afford a car, I’m probably not supposed to be crying about your tax burden.
Complain about taxation all you want to, but these are the kinds of taxes even conservative economists generally applaud: those designed to correct externalities by altering behaviors, not to raise revenue by disincentivizing labor (income taxes).
Ridiculous. All congestion solutions coincidentally bring additional money to government.
Our town (permanent population ~27,000, plus ~25,000 seasonal students) recently voted down a $5/week “city user fee” that was, stupidly enough, going to be charged to anyone working in the entire county, 80%-20%. Obviously these aren’t popular with the community, even if they’re pennies per day compared with the massive London charge.
brownie It’s 6000/PER YEAR regardless of weather they drive or not. The only wayt ot not pay would be to get rid of their car and use public transit.
but if you can afford to live in the center of a major city AND can afford a car, I’m probably not supposed to be crying about your tax burden.
Just because you can afford to live in the city and afford a car doesn’t automaticly make you rich. What about all the working class people who live close to work(shop or office job) who dont want to spend hours commuting to their job and just keep the little car to visit the relatives out in the country on the weekends or once a month. And it’s not like they are going to reduce income taxes with this, it’s just a way for them to grab more money out of your pocket.
Is there ever going to become a day when governemnets actually become responsible with out tax dollars instead of wasting it like crazy and then coming back for more. It’s like the irrisponsible spoiled teenage son who’s asking for mommy and daddy to buy them a new car right after they totalled the family Benz.
Everybody who hates cars is always talking about how horrible it is that the city centers are not used properly, that people live outside the city and commute to work. This new “congestion” tax effectively removes an incentive to live near where you work. The lower cost of getting to work is one incentive to living near work, which is offset by a higher cost of living and (to some people’s way of thinking, anyway) a lower standard of living. With this tax on anybody who owns a car in the designated city center area, the cost disadvantage of living in the city goes up, making it less desireable to live in the city and more desireable to live in the suburbs.
Redbarchetta :
brownie It’s 6000/PER YEAR regardless of weather they drive or not.
No. 6000 = 240 days (48 weeks) x 25. I.e. the newspaper is just giving you a what if figure. It’s not a flat £6000 tax on cars inside the zone. And it’s £25 per day for ‘high’ C02 vehicles. Boxsters etc excluded.
From my perspective the congestion charge worked quite well. Then it was extended West and the zone became so big that of itself it contained enough exempt cars to cause significant congestion.
Combing a CO2 charge into the congestion charge is stupid. Confuses the signal.
However the idea of allocating a limited resource by price is a pretty good one. We use it for almost everything else.
The real problem of the London CC is the crudity of implementation. One price to enter, irrespective of time and location and how long/far you travel in the zone. It’s not really a congestion charge; more of a flat fee to enter a zone where there may be congestion.
I like news blogs, but sometime I wonder whether it’s a case of Chinese whispers. Few people read the original source and the story gets further and further from the truth?
cheers
Malcolm
Malcolm Regardless of how it’s calculated it’s still and extra fee. An additional tax raising the cost of living to people working and living in the city. There is a financial point where people will move out of the city to where it is cheaper to live and just commute since they have to pay the tax regardless. Which will end up making the congestion problem worse with more people driving into the city during rush hour. Look at some of the cities in the US where they have priced a large percentage of the people who work in the city out of being able to financially afford living in the city so everyone commutes, causing more traffic. I can’t seem to get Atlanta out of my head.
I wonder if it will reach the point where it is cheaper to own a horse and carriage if you live in central London? Of course comrade Ken will probably tax that too.
Malcolm: thank you for that, saved me a paragraph. :)
Redbarchetta: in addition to what Malcolm said, I think you are mistaken if you believe that central London (or Manhattan below 96th street, for that matter) has any meaningful working class population. London, like New York, is a geographically large city, and like New York, its working class has been getting pushed to its fringe neighborhoods since time immemorial. And I suspect, though I can’t confirm, that like New York, the only people who own cars within the congestion zone are folks like me who own them because they want to and can afford to, and not because they need to. If you want to fight to lower our taxes go ahead, but don’t do it under the illusion that we are struggling to get by under the weight of an oppressive tax regime.
Lumbergh21: It seems to me that you’re thinking from the perspective of a smallish city with inadequate scale for mass transit (e.g. Providence), a large decentralized city (e.g. Los Angeles), or a large centralized city with poor rail infrastructure (e.g. San Francisco). Living in or near all of those cities, in my experience, requires a car, and a large percentage of the city work force drives in and out every day. London (and New York) is a different city. Only a very small percentage of the work force drives in and out every day; most use mass transit. Congestion pricing only affects a very small number of drivers, and I’d venture that almost none of them live close to work anyway (if they did they wouldn’t be driving). So the effect on population density is minimal; the effect on driving is large.
brownie: Redbarchetta: in addition to what Malcolm said, I think you are mistaken if you believe that central London (or Manhattan below 96th street, for that matter) has any meaningful working class population.
So, it’s just another in a long line of policies that increase economic polarization within the major cities. But I guess now it’s okay…
I’m going to remember this the next time someone wails about Republicans, corporations, etc., making cities affordable only for the rich…