Hi,
what Ken hasn’t said (but implied), and indeed this will be true of other countries too, is that the majority of what we pay the the pump is tax. The cost of petrol and diesel is artificially high here because of the rise in fuel duty.

The road tax for the Crossfire in the UK is £400 per annum, this will rise next year when the road tax bands change. This is to encourage people to buy less polluting cars, and with the apparent CO2 output of the Crossfire, there won’t be any drop in price for us.

Here's the stinger though. The road tax increase is backdated. Any car registered after 2000 (ie 2001 onwards) is subject to this increase. The kicker is that your average family saloon will suddenly cost more to just keep on the road. My girlfriend's Vauxhall Zafira will have a larger than normal tax hike (I believe that the % increase will be greater than for the Crossfire). The Ford Focus will get hit too. It’s not just the luxury or sport car which is being targeted - it’s your average family car too. The aim was to go after the 4x4 and SUV drivers.

Even Greenpeace have criticised this. Scrapping a relatively new car in favour of a new, more efficient one is more ecologically unsound than properly maintaining your existing car. It’ not a “green tax” they say – it’s just a revenue building exercise and will undoubtedly encourage the wrong kind of behaviour.

It will also depress the second hand car market. Any car registered before 2001 will suddenly be worth more than those registered after that date because of the tax issue. Newer second hand cars will drop in value, making the market unbalanced.

The other question is - if you bought a car in 2002, how were you to know that this tax hike would be applied six years on?

Apparently, this whole retrospective tax thing is going to be looked at again, but I suspect that it will be a paper exercise. There is no money in the Government’s pot to absorb a climb-down on this and retain future spending plans. Next year, we'll be feeling the pinch even more than we do now.