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Euro5 tax-breaks to follow Euro4's example

Date: 27 September 2006

Last week's launch of the Euro5 consultation on new car exhaust emissions means we could see another round of tax-breaks for cleaner cars.

You'll remember that after Euro4 standards were revealed, but before they came into force, the Government gave diesel car buyers a 3% benefit-in-kind discount if the car they bought was a Euro4-compliant car.

This had the effect of promoting the cleanest cars (at the time) by putting buyer pressure on car makers to introduce Euro4-compliant cars.

It worked too. Residuals were marked up and sales were influenced.

Although the Government will say nothing officially, experts believe it is highly likely the same will happen with Euro5-compliant diesels when the standard is set sometime in 2008.

Europe has already said that there will be an 18 month to four- year gap between setting of Euro5 and it becoming compulsory.

This is the time when the Government should be offering tax savings to drivers to pick Euro5 diesel cars.

And the one certainty about Euro5 is that diesels will have to have particulate traps fitted, which means an end to cars belching black clouds of soot when they leave the traffic lights.

Now, if only vans weren't a year behind, our atmosphere would be much more pleasant.