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Government may scrap plans for road tax increases for older cars

Changes announced in the last Budget meant that from 2009, all cars that had been on the road since 2001 would face rises in Vehicle Excise Duty (VED), but it now appears likely that next week’s Pre-Budget Report will announce that the retrospective emissions-based tax will be postponed.

The VED changes would have affected almost 70 per cent of Britain’s 26 million drivers, but it was the retrospective aspect of the tax that most infuriated MPs of all parties, along with many other people.

The Environmental Transport Association (ETA) believes that an equitable alternative to road tax would be national road user charging, for not only would such a system cut congestion and thereby help reduce emissions, it would save motorists money as there would no longer be any need for fuel duty or vehicle excise duty; most roads, most of the time, have no congestion, so many people would pay less.