Clause 18 - Fee for payment of duty by credit card

Part of Finance Bill – in a Public Bill Committee at 4:15 pm on 6 May 2004.

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Photo of John Healey John Healey The Economic Secretary to the Treasury 4:15, 6 May 2004

I am not confusing the two. I am about to make it clear that it is necessary for us to be able to introduce the charge if we are to introduce the choice.

Arguments have been pressed on us in favour of introducing the facility to pay by credit card, and some people are no doubt attracted to the proposition as a way of making payments online. No doubt others, as hon. Members have mentioned, are attracted by the ability to use a credit card to spread the cost of a licence, rather than making a single payment, as they do now.

The clause enables the Driver and Vehicle Licensing Agency to pass on the credit card handling charge when vehicle owners choose to pay by credit card. Such practices are becoming commonplace. Anyone who has recently gone online and used a credit card to purchase flights, theatre tickets or tickets for a sporting event from any such booking agent may have found that the operator passed on the handling charge for the use of the credit card.

In such transactions, those who choose to pay by credit card are not being subsidised by those who choose to pay by another method. We are proposing precisely the same position for vehicle licensing. All the existing methods of payment, including debit cards, remain free of charge. The rate of the charge will be set by statutory instrument, in accordance with the cost of the licence and in a way that ensures that the system does not become too complex. However, there is still work that we need to do before we can set the charge.