Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential effect of the level of tax on cars on car (a) manufacturing and (b) sales in the UK.

The Government keeps all taxes under review and when making decisions about the tax system the Chancellor considers a wide range of factors including the competitiveness of the UK tax regime and its impact on industry and consumers. The Government uses the motoring tax system where it is most effective in incentivising the uptake of vehicles with low CO2 emissions (for example through favourable first year Vehicle Excise Duty and company car tax treatment), and balances simplicity and fairness within taxes, whilst ensuring the sustainability of the public finances over the long term.

Beyond the tax system, the Government supports the automotive manufacturing sector through capital grants for the electrification of UK vehicles and their supply chains. This support will ensure the automotive sector is globally competitive and at the forefront of the transition to net zero.