Carmakers have begun lobbying the European Commission to do more to promote biofuels by asking member states to introduce graduated tax breaks giving bigger discounts for low-carbon fuels.

The heads of Germany’s Volkswagen and Italy’s Fiat raised the issue at an informal dinner with several Commissioners, including Günter Verheugen, enterprise and industry commissioner, last week. The European Association of Automobile Manufacturers, currently headed by Fiat, is working on detailed proposals, although its members have yet to agree a particular scheme.