Business sees red over green tax onslaught

British business leaders have warned the Government that business must not foot the bill for new green taxes, which are expected to be introduced following the publication of a Government report on the environment today.

The report by Sir Nicholas Stern, the respected economist, on The Economics of Climate Change is expected to warn that failure to address climate change could slash world economic growth by up to 20 per cent a year. Businesses fear that Chancellor Gordon Brown will use the Stern Review to introduce new pollution taxes that will hit small firms particularly hard.

David Frost, director general of the British Chambers of Commerce, said: "Business has a leading role to play in tackling the impact of climate change and the signs are that many are accepting that responsibility. It is crucial however that business and the Government continue to work together and the temptation to regulate and tax is resisted."

Stephen Alambritis of the Federation of Small Businesses said he feared that business might be thought of as "a soft target." The business organisations pointed out that families produce a lot of CO2 as well, especially through greater use of transport.

Mr Frost said the challenge for the Government was to make it easier for companies to access the help available to them. He added: "A growing business will inevitably use more energy but organisations such as the Carbon Trust must work more closely with the small business community to encourage and support them."