A radical new approach to company car tax bands planned for 2012 could see the drivers of some of the greenest fleet cars on the road hit with tax hikes of up to 50%.

The warning comes after a new approach to CO2-based company car tax was revealed in this year’s Budget.

Chancellor Alistair Darling said from 2012, company car tax (CCT) bands will increase by 1% point for every 5g/km of CO2, starting at 10%.

This means that for the tax bands to remain static, some cars emitting 120g/km or less that currently qualify for the ultra-low 10% band could see a significant increase in their tax liability.

But some experts believe there will be a benchmark around 100g/km and this means cars that used to qualify for the 10% band could see their tax liability rocket 50%.

The actual rates won’t be revealed for at least a year, but it is certain the biggest losers will be some of the cleanest cars that currently qualify for the 10% rate.

For example, a petrol car emitting 118g/km that currently qualifies for the 10% rate would see its liability jump to 15% if the new regime started at 100g/km.

By comparison, a petrol car emitting 160g/km of CO2 would see its tax rate rise from 22% to 23%.

A car emitting 205g/km of CO2 would see its rate rise from 31% to 32%.

The Government defended the move in its Budget statement, stating: “As new tech-nology develops and EU targets for international CO2 reductions from cars come into force, the Government expects many more vehicles to fall within the 10% band.

“To drive demand for low emission cars, the Government intends to scrap this category in 2012 and instead extend the system of CCT bands so that they increase by 1% with every 5g of CO2 per km increase in emissions, from 10%.”

David Rawlings, tax expert and managing director of Business Car Finance, said the potential for a 100g/km starting point for company car tax from 2012 made sense.