Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

No 10 demands U-turn on car tax increases

Mary Dejevsky
Saturday 28 June 2008 19:00 EDT
Comments

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

Gordon Brown has ordered Alistair Darling to drop controversial plans to increase road tax for millions of motorists after a threatened backlash by Labour MPs.

Planned rises in vehicle excise duty for cars bought before 2001 will be scrapped in the pre-Budget report this autumn. Downing Street has ordered the Treasury into retreat after complaints that applying the tax rises retrospectively was unfair.

But Treasury insiders were left scratching their heads over how the Chancellor would find the money to pay for the U-turn, which could cost up to £500m.

The move is an attempt by the Prime Minister to show he is listening to families' concerns over the rising cost of living. But it could prompt accusations that Mr Brown has been forced to perform another U-turn to rescue his troubled leadership and try to reverse a downturn for Labour in the polls.

Mr Darling used his Budget in March to announce increases in vehicle excise duty for the most polluting cars. It later emerged that the rises would apply not only to new cars but to those with 1.5-litre engines or larger bought before 2001 – affecting 18 million drivers.

More than 40 Labour backbenchers, the Conservatives and motoring organisations protested that drivers of older cars should not be penalised. MPs were threatening to rebel against the Government in a Commons vote this week.

A Treasury spokeswoman said: "The Chancellor has met a lot of MPs and he is aware of their concerns. He will look at everything in the run-up to the pre-Budget report, but he has made no promises."

The shadow Treasury minister Justine Greening said: "If it is really the case, this is because the Government has been found with its fingers in people's pockets taking money out."

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in