Fuel tax for green cars 'may soar'

The RAC Foundation has warned that fuel tax for green cars may increase if the Government suffers a shortfall in fuel duty revenue.

The Government is currently encouraging motorists to opt for low-carbon vehicles, which are cheaper to run and attract lower taxation.

However, this could lead to a shortfall in motoring taxation in years to come.

The foundation issued the warning as it published a report examining the environmental performance of 51 cars over a 57-mile eco-drive from Brighton to London, aimed at highlighting the low running costs of electric cars.

Professor Stephen Glaister, director of theRAC Foundation, 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."

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