The government must overhaul motoring taxes as it phases out new diesel and petrol vehicles, according to MPs.
MPs on the Transport Committee say the government must come up with new policy options by the end of the year. A ban on the sale of new diesel and petrol vehicles will be introduced by 2030, which means £35 billion will be lost in tax revenue.
In a report entitled Road Pricing, the Committee favoured a road charging system based on technology which measures road use.
Any scheme would include the drivers of electric vehicles, who would be required to pay for road usage. It would also cover vans and HGV vehicles, as well as overseas vehicle drivers.
Huw Merriman MP, Chair of the Transport Committee, said: 'The UK is the first major economy that needs to come up with an alternative to road tax as we are ruling out new petrol and diesel vehicles from 2030.
'We are more attracted to a big bang approach. We don't see any alternative to telematics in your car which would measure how many miles you drive. You'd have to put incentives in too, for example you could get a refund if your journey was delayed, as you get on rail journeys.
'This has to be a replacement tax, not an additional tax. It will not cost you any more as a collective of motorists, you will have to pay for the road that you use, which you already do.'