§ Mr. Rostasked the Secretary of State for Energy (1) what is the proportion of petrol-driven cars which are maintained by companies or are in other non-private ownership; what proportion is relieved of VAT on petrol consumption; and what proposals he has to provide financial incentives to encourage energy conservation amongst this proportion of consumers;
(2) whether he is satisfied that there is adequate financial encouragement within the existing price mechanism and taxation system to save petrol amongst those motor vehicles not privately owned.
§ Dr. GilbertI have been asked to reply.
The information on which to base an estimate of the proportion of petrol-driven cars which are maintained by companies or are in non-private ownership is not available. To the extent that the petrol such cars consume is used for the purposes of taxable business, VAT may be deducted under the normal machinery of the tax. The substantial increase in the price of petrol, net of VAT, has already given businesses an important financial incentive to restrain their consumption. The Government are keeping the prices 307W of and level of demands for different forms of energy under very close review.
§ Mr. Rostasked the Secretary of State for Energy if he has made any estimate of the possible savings in energy which could be achieved as the result of the increased use of diesel engines in place of petrol engines for private road vehicles.
§ Mr. MeacherI have been asked to reply.
Estimates made by industry suggest that if 50 per cent. of vehicles of all types in this country became diesel engined there would be an annual saving in direct fuel consumption for road use of the order of 7 to 12 per cent. There would be other consequential changes in energy consumption, in vehicle construction and in refinery operation.