Policy instruments (4) - Transport Policy and Planning in Great Britain - page 238

15 Policy instruments (4)
Fiscal measures
15.1 Introduction
Fiscal measures are interventions by the State to affect the payments made or received
for transport goods and services. They include:
• taxes levied as a means of generating income for public expenditure, either
generally or hypothecated (i.e. 'earmarked') for a particular purpose
• variations in the detailed application of these taxes (plus or minus) as a means
of discouraging or incentivising particular forms of vehicle ownership or travel
behaviour
• charges made for the use of publicly owned transport assets or services (e.g. public
car parks)
• fines imposed as a means of enforcing other regulatory regimes (e.g. licensing
conditions or traffic management measures)
• regulation of charges set by private transport companies
• subsidies paid for the provision of transport services or concessionary fares.
As a means of influencing travel behaviour, fiscal instruments have much to
commend them. They are comparatively cheap and swift to implement and can
be 'fine tuned' to reflect changing conditions. A decision by the Chancellor of
the Exchequer to alter fuel duty for example is reflected in a matter of hours in
filling stations across the country. They are also distinctive in that they retain
discretion amongst individual travellers or firms as to how they respond in the light
of their particular circumstances. For example controlling access into a city centre
through some form of charging rather than by physical management measures
allows people to decide on a day-to-day basis whether the trip they are making
warrants the payment involved. This 'advantage' is countered by concerns that
this form of management may be socially discriminatory - i.e. that it is conditioned
by individuals' ability to pay. Certainly as a form of intervention it more obviously
invokes equity considerations.
The fact that fiscal measures alter the distribution of costs and benefits in explicit
monetary terms does however make them especially contentious. Undoubtedly the
most intractable policy issue in this field at the present time is the legacy of motoring
taxation and the extent to which the resentment (and misunderstanding) which
surrounds it affects public debate on possibilities for road pricing and fiscal measures
more generally.