CO2 down but tax to go up

• Motoring group fears punitive taxes on the way
• Drive to reduce carbon dioxide emissions under way
• All eyes now on next month's pre-Budget report

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Total carbon dioxide output from cars has fallen, but fears remain that the Government could still be planning tougher taxes on motorists.

New figures to be released later this week show that output of CO2 from passenger cars in 2004 was half a tonne down on 2002 with 19.4 million tonnes of carbon emitted. That means 15% of all CO2 output is down to passenger cars.

Following the publication of the Stern report into the economic impact of global warning, however, the AA Motoring Trust fears the Government is ready to embark on an aggressive taxation drive.

Ruth Bridger, head of environment, fuels and taxation for the AA, said: 'Nobody disputes the carbon dioxide emission must be reduced dramatically, but punitive hit after hit on the motorist will no achieve it.'

So far, the Treasury has not given any details on what taxation increases may be around the corner, but Chancellor Gordon Brown, who commissioned the Stern report, said the UK would lead the drive to tackle carbon dioxide emissions.

The Stern report is also clear that taxation is one of three ways in which people can be 'faced with the full social costs of their actions.'