Revenue from road charging should remain in the area where it is collected

Helsinki Region Transport supports most of the recommendations of the report by a working group chaired by Mr Jorma Ollila. The report on a road charging system to replace vehicle taxes was published on 16 December. The report suggests that the State would be responsible for collecting the road charges. HSL emphasizes that the revenue should be used in the area where it is collected.

“In terms of transport planning it is of primary importance that the revenue from road charging is spent in the area where it is collected. This would enable us to allocate funding to improve public transport service level, offer an attractive alternative for driving as well as to provide long-term funding for investments,” emphasizes Ms Suvi Rihtniemi, the Executive Director of HSL.

The report proposes that public transport and truck traffic would be excluded from kilometer-based taxation.

“The proposal is to be welcomed both from the point of view of economic competitiveness and public transport. Road charging would somewhat reduce the volumes of car traffic and this would improve the flow of freight traffic and public transport. The popularity of public transport would increase in particular in southern Finland and urban municipalities. Also those driving in cities would benefit from reduced congestion,” says Ms Sini Puntanen, the Director of HSL's Transport System Department.

The report does not take a direct stand on the introduction of congestion charges. In 2012, HSL studied residents' attitudes to transport in the Helsinki region. According to the survey, most of the respondents would like to develop public transport in the area. Over 60 per cent of the respondents were for and less than 20 per cent against mitigating the growth in motorized transport. A small majority of people in the metropolitan area (Helsinki, Espoo, Vantaa, Kauniainen) supported the idea of collecting congestion charges and allocating the revenue to the development of public transport.

HSL emphasizes that if congestion charges were introduced at some point, the same principle HSL suggests for road charging should be applied to congestion charges, i.e. the revenue should be allocated to the area where it is collected.

“During the coming year, we will study also the options for pricing of transport as we prepare the Helsinki Region Transport System Plan HLJ 2015. The impacts of a road charging system in the Helsinki region need to be studied in greater detail,” emphasizes Puntanen.

Comments

Three problems with the kilometer based tax proposal.
1) It eliminating the incentive to purchase fuel efficient cars. Why would anyone think imposing the same tax on a Prius and a Hummer would lead to less pollution.
2) The additional expense of setting up the system.
3) The additional bureaucracies needed to enforce it.
4) The problems with enforcement. As it is now there is no way around paying the car tax on a new car. If this system is implemented it is certain that there will be those that try to avoid the tax by disabling the chip. What will be the penalty for such actions. For that matter what will be the penalty if the chip simply malfunctions.

All and all a totally unnecessary complication to a simple system that will be bad for the environment, expensive to implement, and hard to enforce.

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