More than 9 million motorists face road tax hikes of up to £245 under the Government's "green" car tax plans, the Treasury has admitted.
The figures contradict the Prime Minister’s claim in the House of Commons that most drivers will actually gain from the changes. Alistair Darling may now need to rethink the plans to avoid a revolt like the one over 10p tax.
About 400,000 of the UK’s lowest earners will pay an average of £80 a year more following changes to Vehicle Excise Duty (VED), according to calculations carried out by Justine Greening, a Tory frontbencher, based on official Treasury data.
Of those, 140,000 will pay at least £100 a year more in car tax and for some, bills will increase by up to £245.
This means that in total, Britain's poorest families - those on an income of £15,000 or less - will pay a total of £32 million extra in VED in the next two years.
The Treasury have had to admit the scheme would leave a total of 9.4 million motorists significantly worse off and another 8.4 million no better off, with only 4.1 million benefiting.
Last month, Mr Brown told Mr Cameron in the Commons that if he looked at the VED plan, "he will see that the majority of drivers will benefit from it".
The Tories say that means Mr Brown misled MPs. In Prime Minister’s Questions, yesterday, Mr Cameron said: "Will he now correct himself and apologise to the House for getting it wrong?"
Mr Brown responded, "I have spoken to this House on this matter on a number of occasions. Our policy is fair to those people who have the least polluting cars."
Nearly 50 Labour MPs have signed a Commons motion against the tax changes, and threaten to defeat parts of the tax plan in parliament. The higher tax rates will raise an extra £430 million for the Treasury next year and £700 million the year after.
Used Car Expert believe that as well as directly hurting poor families, car dealers will offer to pay or contribute to road tax in order to try and sustain some new car sales in a difficult market. This extra cost may lead to further pressure on jobs and damage to the economy.