Car Tax Disc expected to be scrapped

Chancellor George Osborne has announced during his Autumn Statement that tax disc will be replaced with an electronic system.

13:54 05 December 2013

Car Tax Disc, which was introduced in 1921, will be scrapped. This is according to Chancellor George Osborne’s Autumn Statement. The tax disc, which is used to show motorists have paid vehicle excise duty, will be replaced with an electronic system. This will allow people to pay the charge by monthly direct debit.

The Treasury said that this is because the government was moving “into the modern age” and that the new system will make “dealing with government more hassle-free.” 

Currently, motorists pay VED in twelve or six month instalments. The new option, which is to pay by monthly direct debit, is expected to cost 5per cent more than paying for a full year. These changes are expected to take effect in October 2014. 

In the 2012 Budget, the government has announced its plans to bring in direct debit system and said it would seek the views of motoring groups on the merits of such change. During that time, it also said it would "consider whether to reform VED over the medium term".