New 'showroom tax' announced in the 2008 budget this month is set to affect car sales.

Following the recent 2008 budget plans announced this month, a poll by Direct Line has found that 50 per cent of prospective car buyers will be put off buying a high-emission vehicle in the future.

The latest budget regarding the forthcoming ‘showroom tax’ is set to penalise existing drivers of family cars from 2009. CAP, the supplier of used car value and technical data has said that the hardest hit will be drivers of automatic, larger engine cars who will face an increase in Vehicle Excise Duty and greater value depreciation.

The poll conducted by Opinium Research found only 23 per cent of survey participants remaining slightly or completely indifferent to the impeding tax plans, proving that prospective car buyers will think twice before they visit the car showroom.

Jennifer Culley, commenting on the findings for Direct Line, said: "We expected the new tax to have an impact, and this swing in opinion demonstrates that by hitting people's wallets, Darling has succeeded in making people think twice before they head for the forecourt."

CAP believes that next year’s proposed increases in Vehicle Excise Duty will have a disproportionate impact on ‘ordinary’ used car drivers, whilst drivers who own older, less environmentally friendly vehicles will be given no encouragement to switch to newer more efficient cars.

Out of the 2096 strong sample of British adults, 60 per cent of people aged 55 and over said they would be less likely to purchase a high emissions vehicle compared to 44 per cent of those aged between 18-34 years old.

Stephen Jury


March 25, 2008