Although the proposed £25 charge for some larger vehicles is being scrapped, the reduced rate of £6 for heavier lorries and vans which comply with European air quality standards, is also being revoked. In addition, the second phase of the LEZ came into force on 7 July, forcing drivers of 3.5 tonne vehicles which do not meet the relevant European emissions standards to pay £200 per day to drive into central London.

FPB members, many of whom struggle to meet the cost of reaching the emissions standards, are already being affected by the standard £8-per-day charge, and, with the second phase of the LEZ now active, small firms face yet another stealth tax.

"Mr Johnson has publicly recognised the concerns of small businesses in London, but, despite his assertions to the contrary, has largely failed to quell them," said FPB spokesman Phil McCabe. "Getting rid of the £25 charge is, of course, a welcome step, but existing congestion and emissions charges are already a significant burden – and a barrier to growth. Unlike larger businesses, small firms do not have the luxury of being able to absorb this additional stealth tax."

Announcing the concessions, Mr Johnson said he was committed to making the congestion charge ‘fairer and more effective' for Londoners.

"I am delighted that we have been able to scrap the £25 charge, which would have hit families and small businesses hardest," he said. "I believe the proposal would actually have made congestion worse by allowing thousands of small cars in for free." The FPB would like the Mayor to go further and revaluate the impact of both congestion and emissions charges on London's smallest businesses.

The FPB believes the money used to set up road pricing schemes would be better spent helping small businesses to invest in technology to reduce their emissions, rather than creating taxes which leave them out of pocket.