SCOTTISH FIRMS could save £270 million a year by taking advantage of a new tax break for greener cars, claims a report out today.

Switching to low-polluting cars could significantly cut the bills of companies because of lower government taxes on vehicles emitting 120 grams or less of carbon dioxide per kilometre.

The new taxes are due to come into force today.Among the models that fall within the pollution limit are the Audi A3, BMW 1 Series, Citroen C1-4, Mini Cooper, Renault Clio, Skoda Fabia, Vauxhall Corsair, Volkswagen Polo and Golf and Toyota Prius and Yaris.

The report has been drawn up by the Energy Saving Trust, an independent organisation funded by the Scottish government to help cut the pollution that is changing the climate. It is calling on companies to green their car fleets.

"I predict that 2008 will see a tipping point where offering - and choosing - low-emitting cars is the only sensible business option," said Mike Thornton, director of the Energy Saving Trust in Scotland.

"Implementing a green fleet policy could save an organisation with 20 cars up to £18,000 every year."

Thornton pointed out that companies that ran high-polluting cars could also find their businesses suffering. "They won't get far when tendering for big contracts unless they can prove their environmental credentials," he said.

The trust's UK report, Behind the Wheel II, also discovered that only one in every 10 companies in Scotland has a written travel policy, half the UK average. And only four out of every 10 Scottish firms considered the impact of company cars as part of their policy on corporate social responsibility.

Similarly, only 12% of Scottish organisations offered a cash alternative to a company car, compared with the UK average of 32%. As many as 28% of companies thought it would cost money to cut carbon emissions.

Converting to lower emission vehicles was "good business practice", argued Colin Howden, director of the transport campaign group, Transform Scotland. "The fact that it's also the correct thing to do in terms of reducing climate change emissions is a welcome bonus.

"We wait to see which Scottish companies - or indeed even public sector bodies - are prepared to put their hands up and say that they will only use cars which meet the 120g/km emissions standard."