India owes London £5 million but has reason not to pay

For the first time, dues owed by the Indian high commission as part of London’s congestion charge – mandatory for all vehicles moving in a zone marked “C” – have crossed £5 million.

For the first time, dues owed by the Indian high commission as part of London’s congestion charge – mandatory for all vehicles moving in a zone marked “C” – have crossed £5 million. It is one of a list of foreign mission defaulters topped by the United States embassy.

The debt owed by the Indian high commission as of March 31, 2017, was £5,098,765 - the fifth highest on the list of defaulters.(hcilondon.in)

A spokesman for Transport for London (TfL) – the local government body responsible for transport in Greater London – told Hindustan Times on Monday that the debt owed by the Indian high commission as of March 31, 2017, was £5,098,765 - the fifth highest on the list.

Every vehicle entering the “C” zone in central London needs to pay £11.50 per day from Monday to Friday between 7 am and 6 pm (some emergency vehicles are exempted) as part of the congestion charge introduced in 2003 to raise funds to improve the transport infrastructure.

The US embassy owes over £11 million. The other four in the top five defaulters are Japan, Nigeria, Russia and India. In total, foreign missions based in London owe over £106 million to TfL. 

The key point of dispute is whether the ‘congestion charge’ is a charge for a service or a tax. TfL officials insist it is a “charge” for a service and not a tax, while India and other foreign missions believe it is a tax, which they are exempt from paying under the Vienna Convention.

An Indian high commission spokesperson said: “We believe that the congestion charge imposed by the UK authorities was not a service charge but a tax, which should be exempted under the Vienna Convention and therefore the Indian high commission, like several diplomatic missions in London, do not pay the congestion charge.”

However, the TfL spokesman said: “We and the UK Government are clear that the Congestion Charge is a charge for a service and not a tax. This means that diplomats are not exempt from paying it.”

“Around three quarters of embassies in London do pay the charge, but there remains a stubborn minority who refuse to do so, despite our representations through diplomatic channels. We will continue to pursue all unpaid Congestion Charge fees and related penalty charge notices and are pushing for the matter to be taken up at the International Court of Justice,” he added.

During former US President Barack Obama’s visit to London in May 2011, his cavalcade was fined £120 for not paying the congestion charge.