The French government has unveiled a radical new green road tax scheme which will reward drivers purchasing cleaner vehicles, including diesel models, with payouts of between €200 and €700.

The new proposals from the environment ministry will see drivers buying larger, fuel-guzzling cars forced to pay purchase tax of up to €3,500 (£2,300) from next January, while those opting for greener cars, such as diesel cars fitted with filters to remove harmful fine particles from their exhaust, will receive a generous rebate.

The new environment bill, outlined by environment minister Serge Lepeltier, aims to reduce air, water and soil pollution over the next five years.

Under the new scheme, heavy, emissions-intensive vehicles such as V8 diesel-powered SUVs will be liable for the highest taxes under the 'bonus malus' scheme, while the buyer of a diesel supermini, such as Peugeot's 206 with particulate filter, could be rewarded with a tax credit of €700. All new cars sold in France will be divided into five classes, from the least polluting to the most.

French officials are still working out the finer details of the scheme ahead of its planned launch on January 1st 2005.

Of the two million cars sold in France each year, the government predicts that one million will fall into the neutral category C and will not receive a rebate or be forced to pay purchase tax. According to official statistics, more than 30,000 people die in France each year from atmospheric pollution, and between seven and 20 per cent of all cancers have an environmental origin.