The Society of Motor Manufacturers and Traders (SMMT) has claimed that, from April 1, the first registration fee for new car sales will rise 10% from £50 to £55.
The move will generate an additional £11 million for the Treasury.
However, a spokesman for the Treasury has denied that any decision on increasing the first registration fee or Vehicle Excise Duty, which is also rumoured to be increasing in the upcoming budget, has been made.
The budget will be delivered by Finance Minister, Alasdair Darling on March 12.
If the change is introduced, the SMMT says that the tax on new car registrations will raise £128 million in total.
“We hope this is not a move by the Treasury to plug holes in its finances,'” said SMMT chief executive, Paul Everitt.
“In the grand scheme, an extra £11 million in tax and a fiver for new car buyers might not sound like much.
"However, we fear that this every-little-helps approach could be the basis for further changes to motoring taxes in March's budget.”