The Dutch government plans to bring the polluter-pays principle into the home garage, Associated Press reports.

Rather than an annual road tax for their cars, drivers will soon pay a few cents for every kilometer (mile) on the road, in a plan aimed at breaking chronic traffic jams and cutting carbon emissions, the Cabinet decided Friday.

The GPS monitoring system could be a test case for other countries weighing options for easing crowded roads. Some cities like London have created congestion charges to control traffic in downtown areas, but only Singapore has a similar scheme for charging according to the amount of travel.

When the plan takes effect in 2012, new car prices will drop as much as 25 percent with the abolition of a purchase tax and the road tax, which now totals more than euro600 ($900) per year for a mid-sized car.

Instead, an average passenger car will pay euro0.03 per 1 kilometer ($0.07 per mile), with higher charges levied during rush hour and for traveling on congested roads. Trucks, commercial vehicles and bigger cars emitting more carbon dioxide will be assessed at a higher rate, the Transport Ministry said.

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