The HGV Road User Levy Act 2013

Neil Baylis of K&L Gates LLP discusses the new HGV Road User Ley Act, which brings in new laws for HGV operators.


On 28 February 2013, the Government passed the HGV Road User Levy Act (known as the HGV Act), which introduced a time-based charge for HGVs with a weight of 12 tonnes or more that use the UK’s road network. As of April 2014, UK hauliers operating such HGVs must pay a levy for each vehicle when paying the annual or biannual vehicle excise duty (VED). Meanwhile, foreign hauliers will be required to pay daily, weekly, monthly or annual levies.

The aim of the Act was to ensure that the costs of maintaining the UK road network were shared more fairly between UK hauliers and foreign hauliers. About 130,000 foreign HGVs enter the UK each year, making a total of 1.5 million trips. Furthermore, most non-UK countries charge UK hauliers a fee for using their road network.

Although the HGV Act requires UK hauliers to pay the levy, the legislation envisages that UK hauliers will be compensated for this levy by a reduction in VED (see below).

For foreign hauliers, payments will be possible through online portals and, on 4 September 2013, the Government announced that, following a competitive tendering process, the foreign operator payment system will be developed and operated by Northgate Public Services. Drivers and operators of HGVs registered outside the UK that visit the country can sign up to receive information updates about how and where to pay the charge. (See the Northgate Public Services website for more information.)

Secondary legislation

New secondary legislation is required to bring many of the provisions of the HGV Act into force, enabling the Vehicle and Operator Services Agency (VOSA), as the primary enforcement agency in Great Britain, and the police to enforce the charge, as well as penalties where the appropriate levy is not paid. This is to be introduced to compliment the HGV Act.

Specifically, this secondary legislation now being consulted on will set fixed penalties and financial penalty deposits and bring UK weight limit banding for VED charges in line with European weight banding.

The consultation is being held from 26 September 2013 until 7 November 2013, to gather views on this secondary legislation before it comes into force.

Penalties and financial deposits

The HGV Act provides that any person using or keeping an HGV of 12 tonnes or more on a UK road must pay an HGV Road User Levy for that HGV. The amount of the levy is based on the deterioration that HGVs cause to UK roads and is calculated in relation to the weight and number of axles of the HGV. Any person using an HGV on a UK road without paying the appropriate levy is committing an offence and may be subject to a fine.

The secondary legislation will increase to £300 the amount of the fixed penalty that hauliers may be charged. The Act permits enforcement officers to issue a fixed penalty notice to a haulier who has not paid the appropriate levy pursuant to the Act. The offender may opt to pay a set amount within a specific period instead of being prosecuted.

This new legislation will also enable a financial penalty deposit of £300 to be charged for failure to pay the levy if the offender does not have a satisfactory UK address. Under the Act, enforcement officers may require a financial penalty deposit to be paid when a fixed penalty notice is issued. Enforcement officers already use this option so that drivers potentially giving a false address or who are based outside of the jurisdiction of the UK cannot easily evade payment of a deposit demanded by a fixed penalty notice. An offender who has been charged a financial penalty deposit may choose to simply put the deposit towards payment of a fixed penalty or to appeal against the fixed penalty. If the appeal is successful, the deposit will be returned. In the case of an unsuccessful appeal, the deposit will be applied towards payment of an unlimited fine imposed by the court.

The Government has stated that the level of penalty and deposit is to reflect the fines incurred for offences of a similar nature such as exceeding the maximum permitted drivers’ hours, failing to ensure that the vehicle is in a roadworthy condition, and operating a vehicle that exceeds the permitted individual axle weights.

Changing HGV weight limits

To make the UK system consistent with European weight banding, secondary legislation will also make a technical amendment to the way UK vehicles are plated for weight. An adjustment will be made to weight banding that is used to set the amount of VED. Currently, a vehicle plated with a certain weight may be loaded up to and including the weight specified on the plate. The amendment to the legislation will mean that a vehicle may only be loaded up to the specified amount on the plate. For example, an HGV that is weight-plated at 21,000kg will fall into a UK weight band where the top weight range is “not over 21,000kg”, whereas under European banding it would fall within “not less than 19,000kg to less than 21,000kg”. Therefore, a vehicle that under the UK banding could be loaded to 21,000kg will, under European banding, only be permitted to be loaded to less than this amount, ie 20,999.99kg, if it is to comply with the same weight plate.

In practice, this change should have no material impact because it is unlikely that enforcement officers would detect a fraction of a gram’s difference in weight, let alone impose penalties upon hauliers in relation to any infringement.

Another aim of the change to the weight banding is to reduce the amount of VED that will ultimately be charged to UK hauliers, in order to balance out the additional costs imposed by the road user levy. UK HGVs with a plated weight within a band limit that is at the top of their band will fall into a lower band according to EU legislation, so that VED is reduced.

For example, an HGV plated under UK weight banding at 21,000kg and incurring £200 per year in VED would come under an EU weight banding of 21,000kg and under “less than 23,000kg”, with £192 of VED to pay per year. The consequence is that notwithstanding the introduction of the road user levy, according to the Government, 9 out of 10 UK hauliers will pay no more than they currently do.

The secondary legislation will be in force at the same time as the introduction of the HGV Act in April 2014.