Canada To Penalize SUVs, Reward Hybrids

"The new federal budget provides for varying rebates for consumers who buy fuel-efficient vehicles (and levies that penalize purchases of gas-guzzlers). The highest rebate available, $2,000, will go to hybrid vehicles including the Toyota Prius and the Honda Civic Hybrid -- and that's on top of the $2,000 rebate already offered by the Ontario government on similar vehicles. (Highly fuel-efficient conventional autos can claim smaller amounts.)

The formula presented in yesterday's budget for calculating rebates and penalty levies uses a vehicle's fuel efficiency based on a combined rating: 55 per cent of the city fuel consumption rating and 45 per cent of the highway rating.

The budget imposes a special levy to be paid by manufacturers and importers of vehicles that can't travel 100 combined city-highway kilometres on less than 13 litres of fuel -- excluding pickup trucks and autos that use alternative fuels.

A Ford Grand Marquis will be dinged for $1,000, while dealers will see a $4,000 surcharge on each Hummer or BMW M5."