CABBIES will be offered £320 a year tax breaks to switch to electric – as sales of ‘green’ motors go into reverse.

Ministers vowed to introduce new laws to exempt carbon neutral cabs from higher vehicle excise duty to improve air quality in big cities.

The Department for Transport (DfT) claimed the move could save taxi drivers as much as £1,600 over five years.

It came as industry figures revealed the first fall in the sale of low emission cars in more than two years.

The Society of Motor Manufacturers and Traders (SMMT) said the drop – which comes after Government slashed ‘plug-in’ grants to punters – was a “grave concern”.

Sales of hybrid cars in June were down 50 per cent on the levels seen in the same month a year earlier.

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SMMT chief Mike Hawes said: “The fact that sales of alternatively fuelled cars are going into reverse is a grave concern.

“Manufacturers have invested billions to bring these vehicles to market but their efforts are now being undermined by confusing policies and the premature removal of purchase incentives.”

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