The Road Fund was instigated by the Liberal Chancellor of the Exchequer, David LLoyd George, in his Budget Speech of 1909. This was enacted with the Development and Road Improvement Funds Act, 1909.
scale of motor duty was introduced with petrol tax set at 3d per gallon.
It was stated that the Treasury would not gain from the new duties
and that all the revenue raised would be spent on the roads.
was paid into the Road Improvement Fund, later known as the Road Fund,
and was managed by the Road Board. The Road Board did not undertake
construction or maintenance of roads but controlled grants to local
authorities to maintain roads.
Act (No.2) of 1915 allowed the Exchequer to retain the whole tax revenue
of the Road Board to help pay for the war. Interest on investments
was retained by the Road Board. In all, £14,329,000 was diverted
from the Road Fund to the Exchequer with £8,250,000 refunded
in 1919 with a further £1,408,000 in 1921/22.
The Roads Act, differentiated between cars and goods vehicles for
taxation from January 1st 1921. Prior to then private cars and goods
vehicles were taxed the same.
Churchill's Budget of 1926 appropriated £7,000,000 from the
Road Fund and made provision for one third of revenue from motor vehicle
duty to be paid to the Exchequer. This was openly justified as protecting
the railways from the growth of road transport. A wholly new revenue
stream to the Exchequer was thereby initiated.
further raided the Road Fund in 1927 by transferring £12,000,000
to the Exchequer on the basis that the Road Fund had sufficient income
and that temporary loans could be made to it if necessary.
Chamberlain continued this trend in 1935, when he noted that the Road
Fund had a credit balance of £4,470,000 and transferred the
total to the Exchequer.
Budget of 1936, repeated the transfer of all credit monies, £5,250,000,
to the Exchequer. At the same time, provision was announced for the
Exchequer to receive all future revenue from motor vehicle taxation.
The Road Fund was required to submit annual estimates of expenditure
and be funded from the Exchequer, based on these estimates, subject
to Parliament's agreement.
Committee on the Form of Government Accounts recommended that the
Road Fund be abolished as it served no useful purpose.
The Miscellaneous Financial Provisions Act, 1955 abolished the Road Fund.
Changes up to Abolition of the Road Fund.
Road Taxation Revenue and Expenditure