UCL research team calls for tax on diesel cars

Report suggests average diesel car would be charged up to £1,700 if tax adopted

Options for government to cut harmful NOx emissions from diesel cars could include tax-based disincentives and city-based charges.

This was the message from UCL’s Institute for Sustainable Resources for Green Budget Europe yesterday (30 June) — which has launched a report proposing fiscal measures to crack down on air pollutants.

The research suggests city based charges and a tax on the most polluting cars

The report, ‘Tackling air pollution from diesel cars through tax: options for the UK’ has been co-authored by Paul Drummond and Paul Ekins, research associates at the Institute.

Their research suggests that those purchasing vehicles producing the most NO2 could be dissuaded via a tax of between £3,500 and £5,000. UCL’s team believes that the level of the proposed national charge is based on the amount of NOx emitted, and so encourages carmakers to clean up new vehicles.

Mr Drummond said: “The report outlines options for government and city authorities to cut NOx emissions from new diesel cars through tax-based measures. The average diesel car currently sold would be charged £1,100 to £1,700 if a NOx-based registration tax is adopted.

“Options are also detailed for city-based charges, with a focus on London, although the lessons may be applied to other cities heavily affected by air pollution, including Birmingham, Leeds, Southampton, Derby, and Nottingham.”

Tax

It is not the first time that taxation has been floated as a solution to the UK’s air pollution problem. In March, leading think thank the Policy Exchange published a report calling for a series of interventions, including fiscal disincentives — while the proposals have also been backed by environmental law firm ClientEarth.

And, cars with high carbon dioxide emissions will already be taxed up to £2,000 from April 2017 under changes to the Vehicle Excise Duty. Applied at registration, Mr Drummond’s argues that his proposed charge could be introduced and work alongside the reform.

On UCL’s research, Richard Howard, Head of Environment & Energy at Policy Exchange, added: “This report shows how our proposal for an air pollution tax on new diesels could be put into practice, creating a set of revenue-neutral incentives to improve air quality. It is important that HM Treasury considers how fiscal policies can be used to address the problem of air pollution.”

Cities

Turning to cities, the report details options for the parallel introduction of NOx-related road pricing, including integration to existing and planned charging schemes.

Commenting on the report, James Nix, director of Green Budget Europe, argued that fumes from diesel cars “kill people”.

“The governing EU regulation was weak before the 23 June referendum and, after the vote, its future application is uncertain. Taxing diesel cars according to their NOx emissions is an increasingly feasible way to cut air pollution”, Mr Nix added.