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Transportation

, Volume 41, Issue 4, pp 697–715 | Cite as

Complementing distance based charges with discounted registration fees in the reform of road user charges: the impact for motorists and government revenue

  • David A. Hensher
  • Corinne Mulley
Article

Abstract

The call for a congestion charge is getting louder and more frequent in many countries as major metropolitan areas experience increasing levels of road congestion. This is often accompanied by a recognition that governments need to find new sources of revenue to maintain existing road networks and to invest in new transport infrastructure. Although reform of road pricing is almost certain to occur at some time in the future in a number of countries, a key challenge is in selling the idea to the community of road users as well as a whole raft of interest groups that influence the views of society and politicians. Simply announcing a need for a congestion charge (often misleadingly called a tax) does little to progress the reform agenda. What is required is a carefully structured demonstration of what might be done to progressively introduce adjustments in road user charges that are seen as reducing the costs to motorists while ensuring no loss of revenue to government. In this paper we show, in the context of Sydney (Australia), that this can be achieved by the reform of registration fees in the presence of a distance-based charging regime that can deliver financial gains to motorists, with prospects of revenue growth to the State Treasury.

Keywords

Road pricing reform Political process Revenue implications Appealing solutions Use-related registration fees Distance-based charging 

Notes

Acknowledgments

This study is supported by the Australian Research Council Discovery Program Grant DP110100454 titled “Assessment of the commuter’s willingness to pay a congestion charge under alternative pricing regimes and revenue disbursement plans”. We are indebted to the NSW Bureau of Transport Statistics (BTS) for providing the data required to undertake the empirical calculations. We thank Tim Raimond, Annette Hay and Charlie Lin of BTS for all their support. Richard Ellison of ITLS assisted in developing some of the macros for the scenario analysis. Discussions with Michiel Bliemer, as well as his detailed comments on earlier drafts, are appreciated as are suggestions by Martin Richards and three referees.

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Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Institute of Transport and Logistics Studies, The Business SchoolThe University of SydneySydneyAustralia

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