National evasion levels have risen to 4.5 per cent of the £4.6bn annual road tax revenue in 2002/2003 and the NAO said new anti-evasion methods should be employed to crack down on those who dodge the charge.
The DVLA already uses some automatic number plate reading equipment where cameras monitor passing traffic and compare the registrations against database of vehicles that haven't renewed or paid for road tax. The NAO said this, along with measures such as wheelclamping, had generated £69m of revenue from fines.
Sir John Bourn, head of the NAO, said in a statement: "It is clear that the DVLA continues to recognise the importance of tackling the evasion of vehicle excise duty. But evasion levels are rising and there remains considerable scope for anti-evasion measures to be extended and deployed in a more coherent manner, in particular through the more widespread use of automatic number-plate readers and increased collaboration with local authorities and police forces."
Earlier this year the government introduced a scheme using number-plate recognition technology to clamp down on lorries and buses that don't have MOT certificates. This could be extended to all 24 million vehicles on UK roads once the MOT computerisation project is completed next year.