Figures released by the government show that 2.2 million people, or six per cent of all vehicles in use, did not pay road tax in 2006.
This is a substantial increase from the 1.55 million vehicles that were untaxed in 2005.
Evasion of vehicle excise duty is expected to cost the government around £220 million in the 2006-07 financial year.
Rates of evasion were found to be higher for older vehicles, with those that are ten years old or more responsible for five times the evasion level of those less than ten years old.
Regionally, the largest increase in road tax dodging between 2005 and 2006 was in the north-west. In Northern Ireland, however, the rate of evasion fell from 5.4 per cent in 2005 to five per cent in 2006.
A spokesperson for the Department for Transport told the BBC: "We are working with the police and local authorities to clamp down on untaxed and uninsured vehicles. Since June 2006 debt collectors and clamping and removal teams have been targeting tax dodgers nationwide.
"The message is clear â€“ not paying your road tax risks hefty fines and losing your vehicle."