The car tax increase is the latest example of policies that may be unpalatable being repackaged as environmental measures. Plans for 10 eco-towns were criticised some developments had previously been proposed and rejected.

A Treasury spokesman said: "The Government is committed to protecting the environment and tackling climate change. Part of this commitment involves promoting sustainable environmental improvements through tax and other economic instruments, and incentivising the development and uptake of lower emissions vehicles."

Motorists are already struggling with soaring petrol prices. The average price of a litre of diesel was a record 118.9p per litre yesterday, while unleaded cost 109.1p.

Petrol companies have been accused of exploiting fears over an oil refinery strike. Shortages across Scotland and northern England have been predicted if workers at Grangemouth, near Falkirk, begin a 48-hour strike on Sunday.  Source

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