The Productivity Commission Report (2017) "Shifting the Dial: 5-year productivity review" Commission suggests that "without policy change, the avoidable social costs of congestion are expected to rise to at least $31.4 billion by 2030." In fact, cities such as London and Singapore have had congestion taxes for a number of years. Congestion pricing, where road tolls are higher during peak period compared with off-peak are aimed at reducing traffic in peak hours.

Please explain with the aid of a diagram, the market failure that a congestion tax is addressing and how the tax may improve social welfare.

Here is the report

https://www.pc.gov.au/inquiries/completed/productivity-review/report/4-towns-cities