vehicle Excise duty might be scrapped as well as replaced with an up-front purchase tax, under plans drawn up by a government advisor.
The purchase tax would still be based on a car’s CO2 emissions, as well as would mean purchasers of supercars as well as gas-guzzlers might see as much as £23,000 added to the listing cost of their vehicle.
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But even little as well as medium sized cars and trucks might see sizeable lump sums added to their price, as a rate of £50 would be charged for each gram of CO2 a cars and truck creates over a pre-set point, which is suggested to be 94g/km.
The suggested plan would still offer incentives for purchasers to select fuel effective cars, though, as vehicles with emissions below a set point would really get a discount rate on listing price, thanks to government subsidies.
Under the scheme, a £9,084 1.25-litre Ford Fiesta would see its listing cost increased to £10,734, while the cost of a more effective 1.6-litre diesel design would autumn from £11,845 to £11,495.
The proposal has been drawn up by Tim Leunig of the Centre Forum think-tank, who has just recently been appointed as a government advisor.
Leunig argues that the new system would be more efficient at persuading manufacturers to establish effective cars and trucks than the VED system. He likewise declares the plan would produce the exact same amount of revenue for the Treasury as the present regime, as the government would be able to change the level of sales tax as the effectiveness of new cars and trucks improves.
What do you believe of the proposals? would you be much better off under the new scheme, or would it stop you from buying a new car? tell us your views in the comments below…