UK: Tougher vehicle tax laws could delay dealer sales

By just-auto.com editorial team | 5 November 2002

New Driver and Vehicle Licensing Authority (DVLA) licensing regulations due to come into force in the United Kingdom on 1 February 2003 could create difficulties for car dealers with their high turnover of vehicles.

From 1 February 2003 it will no longer be possible to apply for a road tax disc unless the vehicle's V5 logbook 'registration document' is also to hand.

Anyone who is not a vehicle's registered 'keeper' [UK bureaucrat-speak for 'owner'] and not in possession of the V5 form will have to complete a V62 and send it to the DVLA which may take up to six weeks to process it if the former keeper hasn't informed the DVLA that they've sold the vehicle.

Dealer sources say that, although the changes are being introduced to cut crime there are inherent problems in the new system.

Dealers will find it difficult to retail a vehicle without a V5 and one source says this could affect residual values of those vehicles without V5s on hand.

Dealers are being advised to 'audit' stock now and establish systems to ensure they consider carefully the purchase of any further vehicles without V5s.

Dealer sources say there is a large number of vehicles on UK forecourts now without V5s that under the new regulations may not be able to be sold for at least six weeks.

The new regulations are intended to reduce road tax evasion and improve the accuracy of the DVLA vehicle register.

However, the commercial and logistical difficulties the new system will create are clear unless the UK motor trade acts to ensure V5s accompany vehicles as they move through the various stages of the trade such as part-exchange, auction, sell-on in the trade and retail.

Information on the changes can be found on the DVLA's website www.dvla.gov.uk.

One source told just-auto: "It seems this issue has not received the attention it deserves. There appears to be no definitive explanation of what the changes will mean to dealers, how they can manage the situation and what target the DVLA has to improve the six-week turn-around.

"The impact on residual values is likely to be temporary as the process application time reduces."