Sadiq Khan's Outer London Tax Explained
Updated: Feb 19
To fix Transport for London's finances, Sadiq Khan is proposing a new daily boundary charge of up to £5.50 for drivers entering Greater London. This ludicrous charge would be a tax on Outer London and a disaster for the capital. Here's what you need to know.
What is Sadiq Khan's Greater London Boundary Charge?
In January 2021, Transport for London published a Financial Sustainability Plan which proposed a Greater London Boundary Charge.
The plan assumes the daily charge would be implemented in October 2023, applying to vehicles registered outside London which drive into the capital between 6 am to 7 pm, seven days a week.
It would cost drivers £3.50 per day, but if their vehicle is not ULEZ compliant, there will be an extra £2 surcharge. This could cost some drivers who need to cross the border daily more than £1,000 a year to enter the capital.
According to TfL's plan, drivers would pay £1.1 billion a year in levies and penalty charges for the boundary charge, generating a profit of £200m to £550m a year once operating costs and bad debts are subtracted.
Why do we call it the Outer London Tax? We call it the Outer London Tax because Sadiq Khan's boundary charge would be levied at the Outer London border. Although the capital's drivers will be exempt from the charge, outer boroughs will be paying the price. Outer London will be hit hardest by the boundary charge. It will penalise people for driving into the capital to work, shop and visit friends and family.
By slapping workers with a £1,000 a year bill to drive into the capital, including NHS staff, police officers and teachers, Khan's boundary charge will hurt Outer London's economy and public services.
And it will deter people from driving into Outer London to shop, hammering small businesses and high streets.
It will also have serious social consequences for Outer London. It will slap friends and family who drive across the border to visit loved ones and care for them.
Will Sadiq Khan introduce the Outer London Tax?
As Mayor, Sadiq Khan is Chairman of Transport for London. That means Khan is responsible for the proposals within TfL's Financial Stability Plan, including the Greater London Boundary Charge.
After the plan's publication, Sadiq Khan asked TfL to conduct a six-month feasibility study into a Greater London Boundary Charge.
Sadiq Khan is threatening to introduce the charge if the Government doesn't devolve Vehicle Excise Duty funding to City Hall, which the Transport Secretary has ruled out.
The Mayor could fix TfL's finances without Vehicle Excise Duty funding or a Greater London Boundary Charge. Sadiq Khan's mismanagement of the capital's transport network has cost TfL billions of pounds in lost revenue, waste and bailouts.
If Khan got a grip of TfL's finances, made savings and expanded Tube sponsorship, he could fix the damage he caused. Instead, he's proposing a Greater London Boundary Charge, on top of his plans to:
Increase his share of Londoners' council tax bill by 9.5%
Extend the Ultra Low Emission Zone to the North and South Circular roads.
Hike the Congestion Charge to £15 for seven days a week.
How can you help stop the Outer London Tax?
Shaun Bailey, the Conservative candidate for Mayor of London, is campaigning to stop Sadiq Khan's Outer London Tax. Sign and share his petition.