Key facts
- A UK thinktank, the Centre for British Progress, has urged the immediate introduction of taxes on self-driving cars.
- The proposed tax aims to offset job losses and increased congestion caused by autonomous vehicles.
- Government projections suggest up to 40% of cars sold could have self-driving capability by the mid-2030s.
- The report warns that widespread AV adoption could put hundreds of thousands of private hire jobs at risk.
- The thinktank calculates that an AV charge matching the social cost of congestion could raise £47bn annually by 2050.
- Wayve, a British tech firm, criticized the proposal, stating it would penalize UK innovators.
A UK thinktank has urged the government to introduce taxes on self-driving cars to mitigate potential job losses and increased congestion. The Centre for British Progress, a non-partisan organization, argues that implementing charges now, before autonomous vehicles (AVs) become commonplace, would ease the transition and provide a future revenue stream to replace dwindling fuel duty.
The report highlights that widespread AV adoption could put hundreds of thousands of private hire jobs at risk, with government projections indicating up to 40% of cars sold could have self-driving capability by the mid-2030s. It also warns that individual ownership of AVs may increase car usage at the expense of public transport, leading to greater congestion. According to Department for Transport forecasts, highly automated driving could bring a 24% rise in road miles by 2050.
David Lawrence, a report author, drew a parallel with fuel duty, introduced in 1909 before mass car adoption, suggesting it is best to act early to avoid a later political fight. He noted that even if tax revenue doesn't peak until 2050, it would affect 30-year bond yields today, impacting the government's fiscal headroom.
However, Wayve, a British tech firm involved in AV development, criticized the proposal, stating it would "penalise the UK’s most promising innovators." Sarah Gates, VP global affairs and assurance at Wayve, added that such a tax would undermine the government's growth agenda and send the wrong signal to innovators.
The GMB union, representing taxi and private hire drivers, stated that a tax on AVs would not go far enough. Simon Rush, president of the GMB London region drivers branch, called for a government plan to reskill and redeploy drivers, noting that their questions to the government and operators have gone unanswered. He suggested an AV charge could partially mitigate economic disruption but emphasized the need for more comprehensive solutions.
Ministers have previously backed the rollout of AVs as a "transformative opportunity" for the UK, with robotaxi services already starting in London through partnerships like Uber and Wayve. Other companies, including Google's Waymo and China's Baidu, are also vying to enter the market. The report calculates that by 2050, an AV charge set to match the social cost of congestion, approximately 88p per mile, could raise £47bn annually.