France has introduced this year a fairly simple system of bonus/malus for new cars linked to their CO2 emissions (if below 120g/km, you get a few hundred euros bonus, if above 200g/km you pay a couple thousand euro penalty).

The change in the kinds of vehicles sold this year has, so far, been remarkable, with a massive boom for smaller cars (especially those with the best engines, emissions-wise), large drops for bigger cars and more polluting engines, and a massive effort by manufacturers to provide models that fall jsut below the threshholds.

When half-year statistics come out next month, I'll try to do a post.

In the long run, we're all dead. John Maynard Keynes

Japan has had such a system for a long time.

The bigger the engine, the higher your yearly car tax, and the higher your twice yearly car-inspection fee.  These are not trivial taxes.  I pay 35000 yen a year or so in car taxes for my small 4-cylinder engine, around 1300 cc or so.  Above 1450 cc you end up in a different tax bracket, and have to pay somewhere around 100000 yen a year in car taxes.  And there are even higher brackets as well.

On the other hand, if you're willing to put up with a truly tiny car and an engine no larger than 500 cc, there's a special Keizai-kuruma bracket, with negligable car taxes.

Sadly, those k-cars are increasingly replacing bicycle use, as the younger generations are too lazy to ride anywhere, and as the suburban and rural infrastructure has been optimized for car usage along American lines.

a siegel: I've long believed that property tax on vehicles should be, in part at least, based on fuel efficiency/engine size to help lower that long term demand.

China to raise car tax to spur fuel efficiency
(Bloomberg)
Updated: 2006-03-22 17:31

China will adjust its tax rates on automobiles, motorcycles and rubber tires. China's government said it will adjust its tax rates on automobiles, motorcycles and rubber tires to encourage the use of vehicles with smaller engines that burn less fuel.

Beginning on April 1, the top tax rate for automobiles will be raised to 20 percent from 8 percent for vehicles with engine displacements larger than 2 liters, according to a statement posted on the Ministry of Finance's Web site.

The government of the world's third-largest vehicle market is trying to encourage consumers to choose cars with smaller engines to cut fuel consumption as rising incomes and falling car prices make cars affordable to more people. Individual vehicle ownership more than doubled to 13.65 million units in 2004 from 6.25 million in 2000, according to the China Council for the Promotion of International Trade.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)