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MPs gear up for car tax challenge MPs gear up for car tax challenge
(41 minutes later)
Chancellor Alistair Darling is facing a fresh challenge from MPs over plans to raise vehicle excise duty on the most polluting cars registered since 2001.Chancellor Alistair Darling is facing a fresh challenge from MPs over plans to raise vehicle excise duty on the most polluting cars registered since 2001.
The Tories say 2.3m families will have to pay between £100 and £245 more each on cars which they already own.The Tories say 2.3m families will have to pay between £100 and £245 more each on cars which they already own.
Some 69 MPs, including 49 Labour, are urging ministers to reconsider so the higher rates apply only to new cars.Some 69 MPs, including 49 Labour, are urging ministers to reconsider so the higher rates apply only to new cars.
The challenge comes as lorry drivers prepare to stage a mass protest and lobby of MPs over fuel duty rates.The challenge comes as lorry drivers prepare to stage a mass protest and lobby of MPs over fuel duty rates.
MPs are expected to debate the vehicle excise duty plans, which the Treasury says will mean 66% of drivers will pay less or no more, from about 1240 BST with a vote due at about 1800 BST.MPs are expected to debate the vehicle excise duty plans, which the Treasury says will mean 66% of drivers will pay less or no more, from about 1240 BST with a vote due at about 1800 BST.
'End uncertainty''End uncertainty'
The battle will begin just a day after the government avoided a potential revolt over the abolition of the 10p tax rate.The battle will begin just a day after the government avoided a potential revolt over the abolition of the 10p tax rate.
About 20 Labour MPs were threatening to rebel unless there was more help for the 1.1 million low-paid people who lost out after Mr Darling's £2.7bn compensation package for the 10p tax losers.About 20 Labour MPs were threatening to rebel unless there was more help for the 1.1 million low-paid people who lost out after Mr Darling's £2.7bn compensation package for the 10p tax losers.
FROM THE TODAY PROGRAMME More from Today programmeFROM THE TODAY PROGRAMME More from Today programme
But the rebels backed down after Treasury Minister Jane Kennedy promised the chancellor would deal with the issue in his pre-Budget report in the autumn.But the rebels backed down after Treasury Minister Jane Kennedy promised the chancellor would deal with the issue in his pre-Budget report in the autumn.
On Wednesday, attention will turn to the controversial increase in vehicle excise duty (VED).On Wednesday, attention will turn to the controversial increase in vehicle excise duty (VED).
Under the plans, owners of some of the oldest cars could face a tax rise of around £200 - a move which the Conservatives and many Labour MPs say will hit poorer drivers the hardest.Under the plans, owners of some of the oldest cars could face a tax rise of around £200 - a move which the Conservatives and many Labour MPs say will hit poorer drivers the hardest.
Greenpeace concernGreenpeace concern
But shadow Treasury minister Justine Greening said for some 2.3 families, the cost could be even higher.But shadow Treasury minister Justine Greening said for some 2.3 families, the cost could be even higher.
"Labour's backdated VED rises will double the pain for families struggling to cope, hitting twice as many people for up to twice as much as the 10p tax fiasco," she said."Labour's backdated VED rises will double the pain for families struggling to cope, hitting twice as many people for up to twice as much as the 10p tax fiasco," she said.
"Labour backbenchers joined us in making Gordon Brown see sense to compensate the 10p tax rate losers. This time with road tax, families can't afford to wait a year for Labour MPs to force another government U-turn.
The VED reforms will strengthen the incentive to develop and use cleaner more fuel-efficient cars and will save an additional 1.3m tonnes of CO2 by 2020 Treasury spokesman Hauliers head to fuel price demoThe VED reforms will strengthen the incentive to develop and use cleaner more fuel-efficient cars and will save an additional 1.3m tonnes of CO2 by 2020 Treasury spokesman Hauliers head to fuel price demo
"They should end the uncertainty now and vote down these unfair and retrospective VED tax rises." The Conservatives have put forward an amendment to the Finance Bill to stop VED applying to cars bought before March - when it was announced in the Budget.
According to Conservative calculations, the Budget changes will move 1.2m of the most polluting band F cars registered between 2001 and March 2006 into the new bands L or M, upping their VED from £210 now to £430 or £455 in 2010. Meanwhile Labour MP Ronnie Campbell's motion - asking the government to reconsider the "retrospective effect" of the tax - has been signed by 69 MPs, 49 of them Labour.
A further 1.1m band F car drivers will move to band K, and face a hike from £210 now to £310 in 2010. Ms Greening urged Labour backbenchers to back the Conservative amendment to "end the uncertainty now and vote down these unfair and retrospective VED tax rises".
Cars affected include: the Citroen Picasso, Ford Mondeo, Vauxhall Astra and Honda Accord, the Tories say. 'Easier ride'
Greenpeace executive director John Sauven said the plan to bring in higher taxes on cars which people have already bought "gives green taxes a bad name". Greenpeace executive director John Sauven has said the plan to bring in higher taxes on cars which people have already bought "gives green taxes a bad name". He believes it should just apply to new cars, rather than forcing people to pay for a choice made in the past.
But a Treasury spokesman said: "Low-income families are far more likely to buy or drive cars in lower VED bands and will therefore either pay less or the same as they do now. But Tim Yeo, the Conservative chairman of the Commons Environmental Audit Committee, said while MPs would debate whether the new rates were being introduced too quickly, the principle was correct.
He told BBC Radio 4's Today programme: "Three times as many people buy a second hand car as buy a new car so if we are going to use bigger differentials in vehicle excise duty to influence car purchasing decisions they have to apply to existing second hand cars as well as new ones."
He urged the government to stick to its environmental agenda, saying any attempt to give motorists an "easier ride" on green taxes would be "catastrophic" for the fight against climate change.
A Treasury spokesman said: "Low-income families are far more likely to buy or drive cars in lower VED bands and will therefore either pay less or the same as they do now.
"What's more, once the reforms are fully implemented, around two-thirds of drivers will still be paying less or no more in real terms than they were in 1997."What's more, once the reforms are fully implemented, around two-thirds of drivers will still be paying less or no more in real terms than they were in 1997.
"The VED reforms will strengthen the incentive to develop and use cleaner more fuel-efficient cars and will save an additional 1.3m tonnes of CO2 by 2020.""The VED reforms will strengthen the incentive to develop and use cleaner more fuel-efficient cars and will save an additional 1.3m tonnes of CO2 by 2020."
Are you a car owner? How will the proposed raise to vehicle excise duty affect you? Send us your comments using the form below:Are you a car owner? How will the proposed raise to vehicle excise duty affect you? Send us your comments using the form below:
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