The government is preparing to reverse its plan to increase duty on older, more polluting cars in response to a growing backbench rebellion, two cabinet ministers hinted today.
More than 30 Labour MPs have signed a Commons early day motion demanding repeal of the £200 vehicle excise duty increase.
The move echoes the crisis the prime minister, Gordon Brown, faced over the abolition of the 10p income tax band, which led to the chancellor, Alistair Darling, offering a hastily-constructed £2.7bn compensation package.
The justice secretary, Jack Straw, appeared to suggest that changes to vehicle excise duty due to come into force next April could be amended in this autumn's pre-budget report.
"The chancellor and the prime minister say they are listening to public concerns and if there are going to be decisions, they could be made in the autumn," he told BBC Radio 4's The World At One.
He added: "It's very important that we make proper measures and judge things properly."
It came as hundreds of lorry drivers protested in London and Wales over soaring fuel prices. The hauliers, who say rising diesel prices and the government's planned 2p fuel tax rise are destroying their businesses, want a 20p to 25p cut in the tax on a litre of fuel.
Earlier the business secretary, John Hutton, also offered hope to discontented backbenchers that the government may abandon the increase in duty.
"Obviously, the chancellor is listening to what people are saying about vehicle excise duty, as he has done on a number of occasions recently about tax rises," he told BBC Radio 4's Today programme. "It's right that we listen to people's concerns," he said.
He added that the government was trying to strike the right balance between encouraging people to make green choices and hammering people.
Labour backbencher Austin Mitchell told Sky News: "It is a bombshell that will explode when it comes into force. We are warning this will hit people and will hit the government."
Rob Marris, parliamentary private secretary to the Northern Ireland secretary, Shaun Woodward, is to join a group of backbench MPs who will tell the chancellor in a meeting next week to rethink the duty.
Marris, Labour MP for Wolverhampton South West, yesterday told Radio 4's PM programme : "Millions of people could be affected. Medium sized family cars, depending on what sort of engine and CO2 emissions they have got, could be hit very hard."
He added: "It is not about changing future behaviour because these cars already exist in the fleet. Therefore it is retrospective tax. I am in favour of prospective green taxes to change people's decisions when buying a new car. But taxing them heavily on a car which may have been bought seven years ago does not seem a good way to go and will discredit the concept of green taxes."
Ronnie Campbell, the Labour MP who tabled the Commons motion attacking the increased levy, said the tax was "unfair" on people who bought their cars a few years ago not knowing that the government were going to impose such a tax.
Campbell also called on the government to drop a planned 2p increase in fuel duty due in October. "I think people just at this moment can't afford it."
The shadow chancellor, George Osborne, claimed that poorer families with older cars will be hit hardest.
"Everyone knows that Alistair Darling and Gordon Brown will be forced to U-turn on this issue, as they have on so many other tax changes, so why put off today what they will have to do tomorrow?
"The Conservative party has consistently opposed these measures. We believe that any increases in road tax should be focused on the most polluting vehicles and offset by reductions in family taxes so that they are genuine green taxes, not stealth taxes."
Greenpeace has condemned the plan to increase tax retrospectively and said the higher tax rates should only apply to new cars.
Executive director John Sauven said: "It's the kind of measure that gives green taxes a bad name because it does not change behaviour."
