Pressure is being stepped up on the Chancellor to reform vehicle excise duty to penalise motorists who buy polluting diesel vehicles.

 

Thirteen transport groups and charities have signed a letter calling on Philip Hammond to introduce an £800 one off payment on new diesel vehicle purchases in next month’s Budget.

 

They say that the VED reform could raise £500M a year to fund measures to tackle air pollution. The measure was proposed last spring by think tank the Policy Exchange.

 

The letter to the Chancellor points out that illegal levels of air pollution are contributing to 40,000 early deaths a year and is thought to cost society more that £27Bn annually. It claims that VED not only fails to recognise that diesel vehicles are a major source of pollution but incentivises people to buy them over petrol powered vehicles.

 

It states that the Government has “a moral and legal obligation to protect people from harmful levels of air pollution” and adds that “it is only fair that VED should reflect the extra financial and health impact that diesel cars have on society”.

 

Diesel cars make up 45% of new car sales compared with just 18% in 2001, the year when former Chancellor Gordon Brown reduced tax on the purchase of new diesel vehicles.

 

“Diesel cars are a major source of pollution in the UK and this new payment will go some way towards funding air quality measures, such as car scrappage schemes, which will help reduce our already dangerous levels of air pollution,” said Bridget Fox of the Campaign for Better Transport, one of the signatories on the letter to the Chancellor.

 

"We want to see a smart scrappage scheme that supports greener alternatives such as season tickets, e-bikes, or car club membership.”

 

The 12 other signatories on the letter are senior representatives from the British Lung Foundation, Chartered Institute of Environmental Health, Chartered Institution of Water & Environmental Management, Client Earth, Cycling UK, Environmental Protection UK, Friends of the Earth, Greenpeace, Living Streets, the London Cycling Campaign, Medact and Sustrans.

 

A Treasury spokesman said it will not comment on what measures might be considered in the Budget.

 

On Saturday it was reported that Transport Secretary Chris Grayling is calling on motorists “to think long and hard” before buying a diesel vehicle.

 

Department for Transport sources have since said that Chris Grayling was not telling people to stop buying diesel cars, but urging them to consider whether a less polluting vehicle might suit their needs. “We are currently developing our air quality plans and will update them later this year,” a spokesman said.