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Motor Vehicles: Excise Duties

Volume 456: debated on Thursday 1 February 2007

To ask the Secretary of State for Transport what steps the Government are taking to provide greater purchase incentives for smaller, cleaner vehicles. (117549)

Incentives to purchase cleaner vehicles include:

Vehicle Excise Duty, which is graduated according to a car’s CO2 emissions;

Company Car Tax, which is also geared to CO2 emissions; and

the cost of fuel duty.

These incentives relate to running costs rather than purchase cost but they have a direct effect as considerations when purchasing a vehicle. The introduction last year of more informative labelling in car showrooms reinforces this message.

As differences in the size of the vehicle do not in all cases relate directly to differences in the vehicle’s emissions, incentives are based on emissions levels and not size.