Tax horsepower

The tax horsepower rating was computed not from actual engine power but by a mathematical formula based on cylinder dimensions.

The factor of 2.5 accounts for characteristics that were widely seen in engines at the time, such as a mean effective pressure in the cylinder of 90 psi (6.2 bar) and a maximum piston speed of 1,000 feet per minute (5.1 m/s).

In 1912 Ford opened a factory to build Model Ts in Manchester, to circumvent the import tariffs that, up to that point, had increased the effective price of foreign cars.

Under the RAC's formula the Model T was a 22 'tax horsepower' car, making it more expensive to run than its British-built rivals on sale for the same price.

It became common for the name of a model to include both its RAC tax horsepower and its actual power output, such as the Wolseley 14/60 and the Alvis 12/70 of 1938.

To minimise tax ratings British designers developed engines with very long stroke and low piston surface area.

Another effect was the multiplicity of models: Sevens, Eights, Nines, Tens, Elevens, Twelves, Fourteens, Sixteens etc., each to fit with a taxation class.

[3] Despite this, by 1948 the Standard Flying Twelve, a typical mid-size saloon, produced 44 bhp (45 PS; 33 kW) from a 1.6-litre (98 cu in) engine, nearly four times as much horsepower as the RAC system suggested.

The long stroke also meant that piston speeds and the load on the big end bearings became potentially damaging at high power outputs.

Many smaller British cars did not cope well with sustained cruising at 60 mph (97 km/h) or more, which led to reliability problems when the vehicles were exported to other markets, especially the United States.

Cars such as the Austin A40, the Morris Minor and the Hillman Minx all achieved notable initial sales success in the US in the late 1940s, until the short service life of the engines when asked to routinely drive long distances at freeway speeds became clear.

Other imports originating in countries with different tax rules and existent high speed road networks, in particular the Volkswagen Beetle, proved more reliable, and achieved greater sales success.

[10] Several Australian states also added vehicle weight to the power rating, to get a power-weight unit which determined taxation.

[11][12] Although tax horsepower was computed on a similar basis in several other European countries during the two or three decades before the Second World War, continental cylinder dimensions were quoted in millimetres.

The Cheval Fiscal, often abbreviated to CV from "chevaux-vapeur" (literally "steam horses") in tax law, is used for the issuing of French registration certificates known as "cartes grises" ("grey cards").

combine to form the engine's displacement, a commission simplified the formula to: where: A new system was announced on 23 December 1977[14] to come into force on 1 January 1978 calculated by the following formula: where: From 1998 until January 2020,[15] the fiscal tax depended on a standardised value of carbon dioxide CO2 emissions in grams per kilometre (g/km) and the maximum engine power in kilowatts (kW).

Attempts to correlate new tax horsepower values with old ones result in small differences due to roundings used in the new formula which are, for most purposes, unimportant.

[18] Fiscal horsepower is still used in Italy for insurance purposes; it was formerly used also for car property taxation and it is based on engine displacement.

Following the 1973 oil crisis up until the 1990s, it was heavily imposed on vehicles with engines larger than 2,000 cc,[19][20][21] prompting Italian car makers to fit turbochargers for extra power without enlarging the displacement.

Another effect was to make it very expensive to run cars imported from countries where there was no fiscal incentive to minimise cylinder diameters: this may have limited car imports from the US to Europe during a period when western governments were employing naked protectionist policies in response to economic depression, and thereby encouraged US auto-makers wishing to exploit the European auto-markets to set up their own dedicated subsidiary plants in the larger European markets.

This rarely happened in the US, where license plate fees, even adjusted for horsepower ratings, were comparatively much lower than European car taxes.