19/05/2011
By Steven Birch
Motorists driving low-emission vehicles could face fuel bill increases if the Treasury is to avoid a shortfall in motoring taxation, according to the RAC Foundation.
Ministers are actively encouraging drivers to choose low-carbon vehicles, which can lead to cheaper car insurance, lower running costs and reduced taxation.
But a report from the foundation has revealed that this could become a problem for the Government as tax revenue would fall as more drivers take up this option.
The warning came as part of a study that examined the environmental performance of 51 cars over a 57-mile eco-drive from Brighton to London.
This test was used to demonstrate how much cheaper electric cars are to run, with average electric vehicle motorists spending around 3p per mile on fuel.
RAC Foundation director Professor Stephen Glaister said: "At some stage a point will be reached when the Government is likely to either start putting up tax on green fuels or the Treasury must accept a cut in its income. For all the talk about sustainable transport there also needs to be a sustainable and equitable tax regime.
"With just 1,500 electric cars registered in Britain at the end of 2010 clearly this is not going to be an overnight problem, but it will have to be tackled sooner or later. Given that there are real doubts that the price of battery-powered cars will fall significantly, drivers are likely to be unhappy with anything that increases their day-to-day outgoings."
