Reforming UK taxation for large, heavily-polluting cars

(Transport and Environment, 1 Mar 2024) The UK is failing to properly tax oversized, highly polluting cars compared to other European countries. Reforming taxes on new car purchases, targeting those vehicles could be imperative.

The UK is failing to properly tax oversized, highly polluting cars compared to other European countries. It is lagging well behind in creating a clear tax differential between battery electric (BEVs) and petrol SUVs, ranking 24th out of 31 European countries.

New higher polluting cars are taxed at a significantly lower rate at the point of purchase in the UK compared to other European countries with similar tax systems, meaning the UK Government is missing out on an equitable and easily actionable source of revenue by not targeting buyers of oversized, over-polluting SUVs.

A consequence of not properly taxing higher polluting cars at the point of purchase is that the UK has a much higher proportion of new highly polluting cars registered than other European countries. Cars with over 160 gCO2/km represented over 15% of new private car registrations in 2023 in the UK, compared with just 0.7% in France, which taxes higher polluting, oversized cars much more heavily.

External link

Transport and Environment, 1 Mar 2024: Reforming UK taxation for large, heavily-polluting cars