Amendments 10, 11 and 12 stand in my name and those of a number of Members on both sides of the House. They deal with the vehicle excise duty supplement, and, in particular, with how it applies to the new electric zero-emission taxis. I should probably declare an interest, as chair of the all-party parliamentary group on taxis. I am delighted that the amendment carries not only cross-party support but support throughout the country: in inner and outer London, Brighton, Sheffield, Bradford, Exeter, Huddersfield, Cambridge, Stoke-on-Trent, Bedford, Cardiff, Chesterfield, Sunderland, Leeds and Rotherham. Sterling work has also been done by my hon. Friend the Member for Oxford East (Anneliese Dodds), not just in Committee but in presenting the same powerful case this afternoon. I hope that this is an issue on which we can find common cause with those on the Treasury Bench.
During the debate on the Budget and subsequently the Finance Bill, I welcomed the Chancellor’s announcement in the Budget to exempt zero emission-capable taxis from the vehicle excise duty supplement, but I also cautioned that that exemption would not kick in until mid-2019. Zero emission-capable taxis are already
available for sale and have already hit the streets of this city and others. This new generation of the iconic black taxi not only provides passengers with a new degree of comfort and great surroundings, including the ability to see the sights of London through the roof while driving around but, most significantly and pertinently for the purposes of this debate, it is environmentally friendly. Members on both sides of the House are increasingly aware of how difficult taxi drivers in this city and across the country are finding their trade in the face of aggressive, and in many cases unfair, competitive practices. The Government need to do all they can to stop that great iconic taxi being driven off the streets of this city and others.
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The Government announced significant changes to the VED banding structure in the emergency Budget of 2015, which came into force on 1 April 2017. Under those changes, drivers of the new electric taxi would not have to pay the standard rate of VED based on the vehicle’s CO2 emissions. However, they would pay a supplement for expensive cars of £310 per year for the first five years as the taxi costs over £40,000. This means that drivers of the new zero emission-capable taxi will be stung for the supplement, to the tune of £1,550.
Grants from both the Government through the Office for Low Emission Vehicles and from Transport for London recognise the high costs of the zero emission-capable taxi and the risk that that stops drivers taking up this environmentally friendly vehicle. They have done so by offering grants of up to £7,500 off the taxi for the first 9,000 taxi drivers to buy it. The Government will claim back one fifth of these grants through the VED supplement change.
That reform was counterintuitive and clearly at odds with the Government’s intention to make VED fairer for motorists and to reflect improvements in new car CO2 emissions. I welcome the fact that the Treasury has acknowledged that this was an “unintended consequence” of the VED reforms. In recognition of that, the Chancellor announced the change in the autumn Budget that I have mentioned, but it will not kick in until 2019. That is where these amendments come in.
Amendments 10, 11 and 12 are designed to bring forward the exemption for the new electric taxi to the day that this Bill is passed as an Act. That would show taxi drivers in this city and across the country a clear determination on the part of the Government to help them to drive more environmentally friendly vehicles, but also recognise the significant pressures that the taxi trade is under.
My amendments perhaps go further than the Chancellor’s statement in the Budget intended, in that they would apply to all taxis over the value of £40,000. I am happy to debate the merits of that position with the Minister, but I gently say to him, in the hope that we get movement from Ministers, that I have raised this point on the Floor of the House, it was raised in the Bill Committee, and I have raised it formally and informally with Ministers, and I hope the Minister will stand at the Dispatch Box today and give taxi drivers in my constituency and across the country the good news that the Government recognise the issues and are determined to make sure that that exemption kicks in earlier than April 2019. Otherwise, the Government will have created a perverse
incentive for drivers to delay taking up a new environmentally friendly taxi because they know they will get better value from 2019. None of us wants that, which is why so many Members from across the House and the country have signed this amendment.
I will conclude by making a political point. I hope that the Minister and other Conservative Members will take it in the spirit in which it is intended. There are many taxi drivers in my constituency, across London and the country who are not natural Labour voters. In fact, they have in many cases been dyed-in-the-wool Conservative voters. They cannot understand why the Conservative party has seemingly turned its back on a group of people who are arguably the best example of the small business, entrepreneurial spirit that this country embodies. Many of them have looked to the Conservative party as their champion, but they are now feeling badly left behind, not only because of issues relating to tax but because of the way in which the Conservative party has actively lobbied for a company that is destroying the taxi trade not through fair competition but through artificially low fares created by aggressive tax avoidance, low wages and a reckless and irresponsible approach to the management of data. The Conservative party has actively lobbied for Uber. Ministers have an opportunity today to show that they are listening to taxi drivers in London and across the country by making a simple change that would bring forward the Chancellor’s intended policy to a point in time that would make a difference to taxi drivers. In so doing, they might be able to rebuild a bit of trust in the Conservative party among taxi drivers.
It is clearly in my interests if the Government do not listen to a word I have said and continue to give taxi drivers in my constituency and across the country the impression that the Conservative party simply does not care. However, I know from talking to taxi drivers in my constituency and their families, and many others across the country, that unless we get this exemption through, they will not be able to afford to take up the zero emission-capable taxis. In fact, it is arguable that many of them will not be able to afford to do that anyway. I am less interested in the party politics of this debate, and far more interested in ensuring that the taxi drivers in my constituency, across my city and across the country get a fair hearing and a fair deal from this Government.