Owners of diesel-powered cars can ‘breathe a sigh of relief’ after yesterday’s Budget, the RAC has said.

Before his speech in the House of Commons, the Chancellor, Philip Hammond, had been expected to announce a range of punitive measures against diesel, such as a hike in fuel duty.

However, the Chancellor was less brutal than had been predicted, with just two relatively small anti-diesel policies.

Addressing Parliament, Hammond revealed that, from April 2018, brand new diesel vehicles that fail to meet the latest real-world emissions standards (which currently means every car on sale) will be moved up one Vehicle Excise Duty (VED) tax bracket for their first year.

This will result in a cost to the consumer of between £20 and £500, depending on the vehicle’s CO2 emissions, although that cost will be hidden slightly as the first year’s VED is included in a car’s 'on-the-road' purchase price.

More noticeable to motorists will be the one-percent increase in company car tax for diesel vehicles.

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Overall, though, the RAC said the Chancellor had chosen a ‘relatively light touch’.

‘Beleaguered owners of diesel cars can breathe a sigh of relief that they will not be punished further by the Treasury,’ said Peter Williams, the organisation’s head of external affairs.

However, the Society of Motor Manufacturers and Traders (SMMT), which represents car manufacturers and dealers, said the measures would prevent the UK’s ‘fleet’ of older diesel cars being replaced with newer, cleaner models.

‘Diesel buyers will not face any additional taxation for the next six months, but thereafter will face additional charges that will undermine fleet renewal efforts, which are the best and quickest way to address air quality concerns,’ said SMMT chief executive Mike Hawes. ‘This budget will do nothing to remove the oldest, most polluting vehicles from our roads in the coming years.’

Hawes also complained that manufacturers weren’t being given enough time, saying: ‘Manufacturers are investing heavily in the latest low-emission technology, however, it's unrealistic to think that we can fast-track the introduction of the next generation of clean diesel technology –which takes years to develop – in just four months.’