AMs call on Mayor to write to c-charge dodging embassies
December 9, 2009 by Martin Hoscik · 2 Comments
London Assembly members have called on Boris Johnson to ask US President Barack Obama and other heads of state responsible for embassies with outstanding Congestion Charge fines to explain their refusal to pay to Londoners.
More than £31m is outstanding in unpaid charges and Penalty Charge Notices with the US Embassy owing more than £3.5m. Although the Embassy paid the charge until July 2005 it now refuses to do so claiming the charge is a “tax” from which it is exempt.
In September Mayor Johnson said Transport for London continues to chase embassies who are withholding Congestion Charge fees and penalties.
A motion put forward by Liberal Democrat AM Caroline Pidgeon and seconded by Labour’s Murad Qureshi calls on the Mayor to “write to the Head of State of every nation with Congestion Charge payments and fines outstanding, demanding payment and to publish the responses of each country”.
Congratulating “the 70% of diplomatic missions that do pay the congestion charge on time”, the motion expresses regret “that some of the worst offenders include the embassies of the United States, Russia, Germany and Japan.”
The motion was originally meant to be debated at October’s Mayor’s Question Time however a walkout by Tory AMs meant motions could not be heard.
Proposing the motion Pidgeon accused the US and other embassies of “insulting their host city and denying a valuable source of income to Transport for London”, adding “the congestion charge is not a tax and the vast majority of embassies clearly recognise this. The minority that decide to not follow the rules of this country must now explain in writing how they can justify their actions.”
Mr Qureshi called on the Mayor to “put pressure on embassies refusing to pay the congestion charge”. Qureshi added: “The United States were happy to pay when the charge was £5 – where were their arguments for not paying on principle then?”
OK, but on what true basis does the motion base its logic that the charge is not a tax? When the charge was increased by 60% for the provision of no extra services, it became finally clear that on the standard definition it was a tax and not a charge. A definition, incidentally, that the UK relies upon internationally in deciding what to pay and what not to. I repeatedly challenged the then Mayor to take proper advice on this and publish it. Instead all we have is an extraordinary mealy mouthed statement from Government which fails to admit that any advice has been sought and which really hedges bets (a classic ‘as far as we are concerned everyone should pay’ argument). This is what the “not a tax” argument relies upon. Tolls for roads etc are different – they are a charge and not a tax because they are constructed in such a way to make it credibly appear that the income is paying for the upkeep and construction of the road/bridge. Hence most embassies and high commissions pay these. To open the whole question of international taxation and immunities is OK and there is a case for doing that, but it has to made clear that that is what the argument about the C-Charge and diplomats does. Unless this is addressed, the question will simply go round and round as a nice little political football. Someone should amend this motion to demand, at the very least, proper legal advice on its status. The argument is crucial – it indeed played a big role in the change of wording of the Stockholm version – it changed on legal advice from ‘charge’ to ‘tax’…so it is now called the ‘Congestion Tax’. Which, I’m afraid, is what it is here in London as well. BTW “70% pay”? Well, they do if you count the huge number of embassies and high commissions that have no cars and say ‘yes we pay’! Which is the majority. The non-payers count for well over half of all the diplomatic cars. And also, very importantly, our real government the EU agrees it is a tax. That is why so many EU embassies stopped paying after the price rise and after a series of meetings to agree. Those paying do it by and large for political reasons, or because they already have/are considering introducing a similar tax.
Oh whoops too late to amend – motion carried…oh well, we look forward to the responses _ if you get any honest ones they’ll all be about tax (which indeed the US has argued ever since 2005). BTW did any AMs do what I did on the Assembly? Call all the non-payers? They all said “it’s obvious…it’s a tax”.