Budget 2009: MPs call for stronger 'green' messages

The House of Commons Environmental Audit Committee has called on the ChancellorThe House of Commons Environmental Audit Committee has called on the Chancellor to ensure that longer term objectives linked to reducing carbon dioxide emissions are not eclipsed by economic stimulus measures.

Hypothecation of road fuel duty

• an element of fuel duty revenues should be linked to increased funding for public transport and the development of alternative technologies, such as electric cars, in order to develop public support for more consistent use of fuel duty as an environmental tax

VED for cars

• Treasury should stick to its plans to introduce first year rates of VED in 2010-11 (designed to influence purchasing decisions, akin to a 'showroom tax'), and introduce significant rises in annual road tax for cars already on the road which have the poorest fuel consumption performance

Scrappage schemes

• the Treasury must justify its conclusion that under a 'car scrappage' scheme, the environmental costs of buying a new car would outweigh the benefits of trading an old vehicle for a more efficient model

Aviation tax

• plans to replace Air Passenger Duty with a 'per plane' charge - which the Committee claims would incentivise airlines to fill their flights more efficiently - should be reinstated. Such a measure would tax air freight for the first time
• introduction of fuel duty for domestic flights
• Government should seek co-operation with the new US administration to renegotiate the Chicago Convention, which currently blocks governments from taxing international aviation fuel
• low carbon energy projects should receive the finance they need even when there is a shortage of capital for investment in low carbon infrastructure