Drivers could face new parking tax this week as major UK city looks to slash traffic and pollution

The fees will be in the form of a yearly charge to obtain a licence, but employers who are caught without one can face hefty fines from Edinburgh City Council.

The levy comes after Scotland passed new laws to allow local authorities to create new tax measures. Under the Transport (Scotland) Act 2019, councils in Scotland can introduce a levy in their local area or part of their local area.

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The legislation dictates that all the money raised from the WPL must be invested in improving local transport.

The council website detailed: “For businesses the cost of congestion impacts business by extending journey times, later deliveries, and increasing worker time on the road rather than in productive work.

“For residents and commuters, congestion increases journey times, whether they travel by car or some modes of public transport and active travel.

“Congestion has an impact on air quality. Studies have linked small particles from road traffic to the cause of a variety of health effects including heart and lung disease, links to premature death, diabetes, dementia, mental health and birth outcomes.”

However, while the decision has yet to be confirmed, the council did note that, unlike the Low Emission Zone, the council has not been given funding to set up the tax scheme.

Official documents stated: “No such funding currently exists for the next of future stages of introducing a WPL, and that the next immediate costs would have to come from reserves at a time of huge strain on public finances and likely further cuts from the Scottish Government.”

It is estimated that the rollout of the parking levy would cost the council roughly £100,000, funds which would come out of the reserves.

There are several WPLs across the UK, with the Nottingham scheme charging employees £550 for an annual licence, which most employers pass on to their employees. Drivers could also face penalties of up to £300 if caught without the correct permits.

The council warned that while a WPL would likely generate some additional revenue for the “it remains unclear as to whether such a scheme would deliver a significant reduction in commuter car use”.

The council is set to debate the matter and give its final decision this Thursday, August 29, at the committee meeting.

Despite the cost concerns, the council did suggest the tax would offer “considerable benefits” to the city, including the City Mobility Plan which aims to reduce the amount of cars on the road by 30 per cent by the end of the decade.

The council added: “We must continue to focus on effective measures which can encourage a shift from private car use towards more sustainable modes of travel.

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“Following the commencement of new powers for local authorities to introduce a WPL, it was right that the council undertook an open public consultation so residents, commuters, and businesses could express their views, and thanks those who responded.”