The Impact of Government
It is impossible to examine the economics of transport operation in Britain without discovering the results of government activity. As has already been shown, the government provides directly or indirectly a large part of the infrastructure for road, rail and air services, and it also provides final transport services through the operations of British Rail, the National Freight Corporation, the Docks and Harbours Board, the National Bus Company and the airway corporations. The government’s fiscal policy has an important effect on road and rail transport. Fuel tax increases the cost of petrol and diesel fuel by 500–600 per cent. The total estimated cost of operating a thirty-two-ton lorry in 1968 was 16·54p per mile: 3·69p, or 22·3 per cent of this cost, was represented by fuel tax. Cars and lorries also have to pay licence duties, and new cars are subject to purchase tax. Part of this tax burden may be regarded as a charge for the provision of the roads, but there is undoubtedly a pure tax element (see the previous discussion on track costs). The railways are treated quite differently. Their fuel is exempt from taxation, and passenger services receive a direct government subsidy under the 1968 Transport Act.
KeywordsLicense System Rail Transport Smoke Emission Passenger Transport Road Haulage
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