VED changes 'step in right direction'

Tuesday, August 05, 2008

Enviro committee backs VED changes
'Vulnerable groups' need to be protected
Eco benefits limited

Chancellor Alistair Darling's road tax plans approved

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The Government is not being unfair in using road tax to encourage people into cleaner cars, the Parliamentary Environmental Audit Committee has ruled.

Even the decision to include existing high-polluting cars registered since 2001 in the road-tax shake-up announced in this year's Budget is acceptable, although there needs to be help for lower-income families adversely affected, the committee says.

'The changes to car tax announced in the Budget are a step in the right direction,' said chairman of the committee, Tim Yeo.

'The first-year rates being introduced for new cars will create a kind of 'showroom tax', that could be used to influence buyers of new cars to choose the most efficient model in each class.

'However, the Treasury must also urgently work to ensure these changes are not unfair to vulnerable groups. This includes looking at paying people to trade in their existing high emissions-cars for more-efficient models, and reviewing whether all disabled drivers could be exempted from paying car tax.'

The committee also said, however, that the proposed changes to road tax wouldn't lead to the hoped-for environmental benefits.

'The differentials between high- and low-carbon cars are still nothing like wide enough to make a big impact,' said Yeo.

'According to the Government's own figures, these changes will have only a very limited impact on the environment. The Treasury must be more ambitious, matching increased charges on high carbon cars with discounts or rebates on low emissions vehicles.'