Road tax plans 'could be ineffective'
Date: 26/03/2008 12:00:00
The recent Budget announcement on tax increases for polluting cars illustrates the "wrong-headed" thinking of government, it has been claimed.
According to Clean Green Cars, the government's plans of influencing which cars are bought by raising the tax costs of eco-unfriendly models is unlikely to be effective.
As outlined by the chancellor, six new road tax bands are to be introduced next year, making a scale from A to M to encourage drivers to opt for more efficient vehicles.
"Most new car buyers are not paying for the price of the car - they are paying for the depreciation between the new price of the car and the value of it when they come to resell it. The most effective way of reducing sales of high-polluting vehicles would be to increase their rate of depreciation," the firm claims.
It suggests that the disincentive has been applied to vehicles in the wrong tax band and does not illustrate a consistent approach.