Spain is considering introducing a CO2-based vehicle tax after Congress approved a similar registration initiative late last month, sources close to the tax bureau told just-auto on Thursday.

"This is being considered but there's nothing official yet," said a source close to the matter.

Officials at the tax bureau could not be reached for comment.

The development comes after legislators gave the nod to an initiate to reform the registration tax which Parliament could approve later this year.

Under the initiative, which would become law next January, cars emitting less than 120g of CO2/km won't pay duties while those expelling 120-160g would pay 4.75%.

Drivers purchasing more polluting cars, such as those emitting 121-160 CO2g/km and over 200 grams/km, will have to fork out 9.75% and 14.75% of the vehicle's price tag respectively.

Currently, the registration duty is based on a vehicle's engine size. Petrol cars powered by engines of less than 1.6 litres and diesels under two litres pay 7%. More powerful vehicles pay 12%.

Manufacturers' lobby Anfac has welcomed the new duty, saying it would have benefited 1.1m of the 1.63m cars bought in Spain last year.

Dealers' association Faconauto won't protest against the CO2-based tax. However, a spokeswoman said the lobby and Anfac would continue to push for the introduction of a new and more ambitious car scrapping programme to replace the current Prever scheme, which the state has been reducing and wants to remove next January.

"It's a contradiction that the government wants too boost eco cars through taxation while removing Prever which is the best way to renew Spain's vehicle fleet, one of Europe's oldest," a Faconauto spokeswoman told just-auto.

"The car industry is being demonised with all these initiatives, which come at a time of declining sales. We are worried."

The proposed tax will work similarly to the registration duty to motivate Spaniards to purchase eco friendly cars.

Spain's green crusade come as the country scrambles to cut its greenhouse gases after failing to meet the Kyoto protocol's targets.

As part of its 2008-2012 environmental plan, Spain hopes to slash transport-related emissions by 88m tonnes and use 32m fewer tonnes of petrol to fulfil European emissions-reduction targets.

Ivan Castano

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