Check for Obama!

You owe us money!

With the upcoming state visit of Obama to Britain, another story has raised its head. That of the non-payment of the London congestion charge by several embassies in London. And the fact that at the state dinner, which will also see Londons mayor, Boris "Whats a comb?" Johnson will quietly slip a bill for £5,290,000 on Obama's plate somewhere between dessert and coffee. This is the amount that the US embassy owes for its cars entering the congestion charge zone in the centre of London, and refusing to pay. So this also includes the fines.

Boris on a congestion charge free mode of transport. And getting a workout!

Just to give you a bit of background, London suffered from horrendous traffic. The average speed was about walking speed, it was pretty bad. I know. I tried driving in London it was not an experience I want to repeat! However, after the introduction of the congestion charge in the centre of London (and later being spread west) has seen a sustained fall in traffic of 10-20% as well as an increase in journey times of 0.7 minutes per kilometre. May not sound a lot, but on London's tiny streets, thats massive!

The charge itself consists of a bunch of number plate recognition cameras in a ring round London.

A very slightly scary "parking meter."

These track you as you arrive, and issue a charge. 

You can pay by phone, by text, by going to some shops, the day before, the day of your trip, and day after. The charge is £10 per car. £9 if you set up an automatic account on a credit or debit card which the system will charge automatically on each day you are spotted in the congestion zone.

The Congestion zone in the centre of London.

There are exemptions to the charge. For example, the regular London buses, taxis, minibuses, motorcycles, emergency vehicles, and now, low carbon vehicles. So, hybrids, fuel cell, battery, and high efficiency cars are all exempt. So, if you drive a Nissan Leaf, congestion free driving!

No excuse for the Japanese, with all their car manufacturers churning out hybrids, as well as Nissan bringing out the new all electric Leaf.

Also, I know the US embassy wants to stick with American cars, well, Tesla's sportscars are also  exempt! The congestion beating charge also covers the likes of VW's Bluemotion range Polo and Golf, Seats Ecomotive, Fiats 500 TwinAir, and Volvos S40 DRIVEe. Essentially  as long as the CO2 output is under a certain level, you are exempt.

A charge-beating "boring" eco car! The US made Tesla. 

Should the US Embassy choose, they can take Tesla's 'S' which does look sharp...

Also, the congestion charge can be suspended in all sorts of circumstances, should a a group apply for it, or the emergency services instruct London to do so on the back of an emergency, such as the London bombings. Or extreme conditions. For example, in 2009 it was suspended due to the very bad snow that battered London.

Now, many embassies do pay, some do not.

Here is the "Roll of Shame!" of top non-paying embassies.

1) USA £5.29m

2) Russia £ 4.41m

3) Japan £3.65m

4) Germany £3.49m

5) Nigeria £2.7m

6) India £1.88m

7) Sudan £1.6m

8) Ghana £1.54m

9) Poland £1.49m

10) Spain £1.25m

American Embassy

Now, these embassies all claim they are exempt from the charge since under the Vienna Convention on Diplomatic Relations (1960) that states no Diplomatic mission will be subject to direct local taxation.

Now, the problem here is the fact that the majority of embassies in London DO pay, so they believe that it is not a direct tax, and the second point is, what is direct tax?

Well, by definition, a tax is a fee levied on you by a government which is unavoidable. you have to pay. There is no choice. We all pay tax on our salaries. You work, you pay tax. There is tax like VAT. You buy something, and some of that is this value added tax to the government. 

Now, is the London congestion charge a tax? On the face of it, it looks like it. You want to drive in the centre of London, you have to pay. But if it is a tax, then it is built with so many get out clauses that it almost appears to be a tax that is cuddly! I kind of see the congestion charge as something like a car parking fee. Just covering a very large car park (the centre of London). Embassies would not think twice about dropping a few coins in a meter to pay for 30 minutes of on-street parking, or parking on someones private property.

And given that with the congestion charge there are ways of avoiding it, such as riding a bicycle, using public transport, or renewing your fleet with low-emission vehicles, I am not so sure I would class it as a "direct tax."

If it truly was a direct tax, then surely all embassies would refuse to pay? As it is, most do. Therefore, the US, Russia, Japan and the rest who dont pay are in a minority. And in a democracy, that makes them wrong. 

Japanese Embassy

So, going Boris, slip Obama the bill, he can afford it! And more seriously, it would be interesting to see if this could be a test case in a court of law. I would laugh SO hard if the floppy haired Boris took on the embassies, and won!