TEPR projects: Taxes and incentives
Taxation and incentives can be used to improve the environmental performance of transport in many different ways. In the UK, a car’s first year road tax (also known as vehicle excise duty or VED) and company car tax (also known as the company car benefit in kind scale charge) are based on a car’s CO2 emissions. This aims to encourage the purchase and use of low emission cars.
Grants can be made available to those who buy new, clean vehicles, if these are more expensive than comparable petrol or diesel vehicles. Fuel taxes can also be differentiated to encourage the supply and use of cleaner fuels.
TEPR has worked on various reports on the use of taxes and incentives to encourage low carbon and cleaner transport:
- Fiscal instruments for low carbon transport, which was undertaken with TEPR Associate Malcolm Fergusson for the Low Carbon Vehicle Partnership (LowCVP). It involved a policy analysis and a quantitative assessment of the different future taxation scenarios.
- Consideration of the impact of car and van scrappage schemes, which included a literature review and a quantitative assessment of the parameters under which a scrappage scheme might be successful in delivering reductions in CO2 emissions for cars and vans.
TEPR has also worked on the effects of legislation on car prices:
Previously Ian Skinner of TEPR has worked on the following relevant reports: