Brown's decision delighted the British Vehicle Rental and Leasing Association, the Retail Motor Industry Federation and the Finance & Leasing Association, which made a last ditch bid to have the planned autumn 2000 introductory date shelved.
From next March all new cars will go into one of four bands based on their rate of carbon dioxide emissions. Vans for which there is no CO2 data available will pay £160 VED.
Rates for existing cars have been frozen until March 1, 2001 when the reduced rate for cars with smaller engines will rise to £105 and the standard rate to £160.
Within each band there will be a £10 discount for cars using cleaner fuels such as gas, bi-fuel and dual fuel vehicles and hybrids and a £10 penalty for diesel cars.
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