U.K. may replace fuel tax with road tax

The U.K. could replace its fuel tax with a road use tax based on miles driven and time of day if a proposal by the U.K. transport secretary Alistair Darling's proposal is adopted. The minister called for public debate of the scheme, which could see Britain's drivers (currently 30 million) piloting vehicles with satellite tracking devices attached.

The devices would record the vehicle's movements and allow road-use fees to be calculated from a high range for peak use of congested roads to a low range for non-peak use of uncongested roads.

Charges for road use could range as high as £1.30 per mile ($2.37). Darling called for a national debate on the issue before embarking on pilot studies with local authorities. From there, it could be six to 10 years before a system was fully implemented. At some point in the evolution of the system, London's current congestion toll system and the U.K. fuel tax would be scrapped in favor of the currently proposed system.

A report in the U.K.'s Financial Times said a $125 million contract between IBM Corp. and the United Arab Emirates would fit thousands of cars with satellite monitoring devices.