CHANCELLOR George Osborne abolished the paper tax disc in his Autumn Statement this morning.
Since the tax disc was introduced in 1921, officials say it is no longer required with the DVLA and police relying on an electronic register.
The new system will allow people to pay the annual charge via a monthly direct debit.
The Treasury said it showed the government was moving ‘into the modern age’, according to the BBC.
Osborne announced the end of the paper tax disc in his Autumn Statement when he updated the MPs on the state of the economy.
Commenting on the abolishment of the tax disc, Jonathan Evans, PwC tax partner, said: ‘This will make things easier administratively, although it is not a big change. Many people already renew their tax discs online so this is a logical step.
‘However, there will be people who don’t have access to electronic payment systems or computers so provision will be needed for these people to tax their vehicles. With modern copying equipment it must be simple to produce fake tax discs so it seems a sensible anti fraud measure.
‘A virtual system may make it easier for those in the motor trade or individuals owning vehicles which fall out of use, to stop the tax on a vehicle whilst it is not on the road, since the tax could be cancelled electronically without surrendering a paper disc. This would be good news for taxpayers, and stop tax being needlessly paid on vehicles which are off the road.’
He added: ‘In order to enforce this regime, there will be an increase in the ANPR (Automatic Number Plate Recognition) equipment which in the future could effectively track motorists’ every move.’