// Any litter found on the street could be followed up and traced back to the owner of the car.//
As above, it won't be traced to the owner but to the Registered Keeper (who may or may not be the owner).
A mile or two from me there is, alas, a drive through McDonalds. Many of the "diners" collect their order and then park in the car park to consume them in the comfort of their vehicles. Far better, it seems, to get grease and coffee over your car seats than sitting at the tables provided inside (but it does, of course, save the VAT).
Many of them dutifully discard the wrappings in the McDonalds bins. From time to time (usually two or three times a week) some of the more boisterous customers think it is great amusement to empty these bins over the forecourt and the garbage is cast to the four winds, much of it ending up on the highway. Under your plan, any of this litter that is later collected by the Council could be examined and the customers who have done the right thing with it end up with a letter in the post.
It really is not so simple as you'd have us believe.