Latest news with #LuxuryCarTax
Yahoo
16-07-2025
- Automotive
- Yahoo
EV insider calls out Aussie loophole as potential tax change looms: 'Doesn't make sense'
There are growing calls for Australia to scrap a controversial and generous tax exemption that encourages the purchase of larger vehicles, helping fuel a divisive and damaging trend on our roads. The Australian boss of premium electric vehicle brand Polestar is the latest to campaign for a big rethink of how the federal government's Luxury Car Tax (LCT) is administered, describing it as serving no purpose and creating a reality in Australia that "doesn't make any sense". The luxury car tax means Aussies who are buying a car worth more than $80,576 will pay an extra tax on the cost of the vehicle above that amount, with a higher threshold of $91,387 for certain "fuel-efficient vehicles" such as hybrid models. The luxury tax is charged at a rate of 33 per cent for every dollar above these thresholds, however a loophole means most utes and SUVs are exempt because they are classified as light commercial vehicles regardless of whether they are bought for private or commercial use. Over the years, that has incentivised buyers to opt for large American-style utes to avoid paying the tax, with many critics pointing out that taxpayers were subsidising the purchase of cars that are worse for the environment and cause more damage to roads than their lighter counterparts. Related: Calls to end major $250 million loophole in Aussie car market Scott Maynard, managing director of Polestar in Australia, is pushing for things to change, arguing the tax should simply go, noting that it was originally brought in to protect local car manufacturers but "we don't have a local car industry to protect" anymore. "It is a tax without a purpose," he told CarSales last week. The EV exec doubled down this week saying the situation has become perverse in our car market and highlights the much-maligned exemption. "We've now got more than one and a half times the dual cab ute to tradie ratio, which doesn't make sense," he told NewsCorp papers. "If you consider some of the positioning of some of those particular vehicles, which are clearly no longer tools of trade, I don't think it's a difficult jump to make to put that on the fact that they've enjoyed a tax let-off since 2000." While Polestar, a Swedish automotive company selling high-end electric vehicles, would benefit from the removal of the luxury tax, Maynard is far from alone in his arguments. Associate Professor Milad Haghani, an expert in urban resilience at the University of Melbourne, is among the many critics who continue to question why the exemption for larger utes and SUVs is still in place. "The luxury car tax exception has been one of the biggest incentives for people to go big and buy big cars," he told Yahoo News in May. The status quo means every taxpayer is "effectively subsidising" the purchase of certain mega utes, he said, "and a lot of the buyers don't use it for commercial purposes". The Australian Institute recently calculated the loophole comes at a cost of about $250 million a year to the nation's taxpayers. And that's before other externalities that impose a cost on society are considered with research showing the larger vehicles have an outsized impact on worsening congestion, polluting the environment and degrading our roads. Major EV change sees Aussie driver earn extra $250 in one day BYD photo highlights 'revolutionary' EV feature changing Aussie habits Warning against EV owners' 'revolutionary' solution to battery concern In May, it was reported the Albanese government is considering changing the tax and potentially lowering the 33 per cent rate, as part of negotiations with Europe over a new free trade deal with the bloc of nations. Australian Automotive Dealer Association chief executive James Voortman supports the removal of the tax, which raises more than a billion dollars a year for the federal government, but has echoed concerns from manufacturers about the impact of plummeting resale values in the secondhand market. The Australian Automobile Association and the Federal Chamber of Automotive Industries also wants to see the tax scrapped. In the event it is phased out, the government would likely look to recoup the lost revenue through other road-related charges. Do you have a story tip? Email: newsroomau@ You can also follow us on Facebook, Instagram, TikTok, Twitter and YouTube.
Yahoo
15-07-2025
- Automotive
- Yahoo
Aussie EV boss joins calls for change to controversial car tax that 'doesn't make sense'
There are growing calls for Australia to scrap a controversial and generous tax exemption that encourages the purchase of larger vehicles, helping fuel a divisive and damaging trend on our roads. The Australian boss of premium electric vehicle brand Polestar is the latest to campaign for a big rethink of how the federal government's Luxury Car Tax (LCT) is administrated, describing it as serving no purpose and creating a reality in Australia that "doesn't make any sense". The luxury car tax means Aussies who are buying a car worth more than $80,576 will pay an extra tax on the cost of the vehicle above that amount, with a higher threshold of $91,387 for certain "fuel-efficient vehicles" such as hybrid models. The luxury tax is charged at a rate of 33 per cent for every dollar above these thresholds, however a loopholes means most utes and SUVs are exempt because they are classified as light commercial vehicles regardless of whether they are bought for private or commercial use. Over the years that has incentivised buyers to opt for large American-style utes to avoid paying the tax, with many critics pointing out that taxpayers were subsidising the purchase of cars that are worse for the environment and cause more damage to roads than their lighter counterparts. Related: Calls to end major $250 million loophole in Aussie car market Scott Maynard, managing director of Polestar in Australia, is pushing for things to change, arguing the tax should simply go, noting that it was originally brought in to protect local car manufacturers but "we don't have a local car industry to protect" anymore. "It is a tax without a purpose," he told CarSales last week. The EV exec double down this week saying the situation has become perverse in our car market and highlighting the much maligned exemption. "We've now got more than one and a half times the dual cab ute to tradie ratio, which doesn't make sense," he told NewsCorp papers. "If you consider some of the positioning of some of those particular vehicles, which are clearly no longer tools of trade, I don't think it's a difficult jump to make to put that on the fact that they've enjoyed tax let off since 2000." While Polestar, a Swedish automotive company selling high-end electric vehicles, would benefit from the removal of the luxury tax, he is far from alone in his arguments. Associate Professor Milad Haghani, an expert in urban resilience at the University of Melbourne, is among the many critics who continue to question why the exemption for larger utes and SUVs is still in place. "The luxury car tax exception has been one of the biggest incentives for people to go big and buy big cars," he told Yahoo News in May. The status quo means every tax payer is "effectively subsidising" the purchase of certain mega utes, he said, "and a lot of the buyers don't use it for commercial purposes". The Australian Institute recently calculated the loophole comes at a cost of about $250 million a year to the nation's taxpayers. And that's before other externalities that impose a cost on society are considered with research showing the larger vehicles have an outsized impact on worsening congestion, polluting the environment and degrading our roads. Major EV change sees Aussie driver earn extra $250 in one day BYD photo highlights 'revolutionary' EV feature changing Aussie habits Warning against EV owners' 'revolutionary' solution to battery concern In May, it was reported the Albanese government is considering changing the tax and potentially lowering the 33 per cent rate as part of negotiations with Europe over a new free trade deal with the bloc of nations. Australian Automotive Dealer Association chief executive James Voortman supports to removal of the tax, which raises more than a billion dollars a year for the federal government, but has echoed concerns from manufacturers about the impact of plummeting resale values in the secondhand market. The Australian Automobile Association and the Federal Chamber of Automotive Industries also wants to see the tax scrapped. In the event it is phased out, the government would likely look to recoup the lost revenue through other road related charges. Do you have a story tip? Email: newsroomau@ You can also follow us on Facebook, Instagram, TikTok, Twitter and YouTube.
News.com.au
30-06-2025
- Automotive
- News.com.au
Audi Q4 Sportback review finds the perfect luxury EV salary sacrifice option
Salary workers would be salivating at the thought of four electrified rings. The new Audi Q4 makes the most of government incentives and could be in garages courtesy of novated leases for about $300 a week. With prices starting from less than $90,000, the Q4 is the least expensive e-tron we've seen from Audi. That also means it undercuts the Luxury Car Tax threshold so it's eligible for fringe benefit tax exemptions, which brings the leases into play and opens the door to a whole new market. Aptly named as it slots between the Q3 and Q5 in terms of size, the Q4 sits on the Volkswagen group's (that also owns Audi) modular electric drive platform, which has also been used for its Q5 sibling, the groovy VW ID Buzz, as well as the Cupra Born and Tavascan. The Q4 comes in SUV or Sportback body styles and two performance flavours, the 45 e-tron that just powers the front wheels, or the 55 e-tron that we tested and boasts all-wheel drive power – but also sees the cost push past $100,000. What do you get? Looking sleek and muscular in Sportback guise, the 21-inch alloys fill the expansive wheel arches, then on the inside it has a flat top and bottom steering wheel, stainless steel pedals and matt brushed aluminium inlays. Other nice kit includes three-zone aircon, electric tailgate with gesture control, 'S' embossed leather-trimmed seats, central 11.6-inch infotainment touchscreen, heated front seats, 10.25-inch driver instruments display and wireless phone mirroring apps. Our test car did have nearly $10,000 worth of extras courtesy of metallic paint ($1755), panoramic sunroof ($2925) and the $4700 Premium Plus package that incorporates tinted glass, 10-speaker Sonos stereo system, black exterior styling pack and exterior mirrors, along with an augmented reality head-up display. Grey is the only solid colour that doesn't attract a $1755 premium, with black, two shades of blue, violet, silver, another grey hue and white all metallic options. The Q4 has been available overseas for a few years but the latest models now available Down Under can charge quicker than the initial offerings – using a 175kW public charger the Q4 can shift from 10 to 80 per cent in about 28 minutes. Three-phase 11kW home chargers can replenish the battery in about 12 hours. Running costs are among the best you'll find in the prestige realm. The prepaid deal of $1900 covers three services with intervals every two years or 30,000km. It also comes with six years of roadside assist. All Audi e-trons come with a year's free subscription for the Chargefox network. How was the drive? Cornering flat and feeling nimble, despite tipping the scales at 2235kg, the Q4 offers composure and fuss-free driving. Riding on the massive 21-inch alloys it feels harsh ruts and potholes, yet maintains surprising composure under the majority of circumstances. Quicker than the front-wheel drive versions, the Quattro models manage the 0-100km/h sprint in 5.4 seconds. That's reasonably quick – but not insanely fast like some EVs. The steering feels light and lacks road feel when the going gets twisty. It rekindled memories of Audis from the early 2000s. Cabin serenity is assured and it boasts impressive boot space that easily swallowed our weekly family grocery shop of about 10 bags, while the door-top bottle holders are brilliant – it's a new benchmark and will be loved by those who like their H2O within close reach. Audi claims average consumption of just under 18kWh/100km, but we only got close to that on an easy highway journey. Our test saw an average of 21.6kWh/100km Would you buy one? Kel: For some reason I didn't gel with the Q4, which is unusual for Audis and my preferences. Great looks and easy to drive, it was nice but wasn't remarkable. We recently drove the SQ6 e-tron which was more expensive but I could see and feel the technology advancements. I could happily live with a Q4, but I'd want more value before becoming an owner. Grant: While we drove the 55 all-wheel drive derivative, it would be hard to pass up the benefits of the cheaper 45 models. Leasing benefits offer the best bang for buck when it comes to the Q4, which is a great family runabout EV. For those who want badge kudos, it's a predictable drive with anxiety free-range.
Canberra Times
25-06-2025
- Automotive
- Canberra Times
CarExpert Choice winner: Best Luxury EV
The base eDrive35 also slides under the Luxury Car Tax (LCT) threshold for fuel-efficient vehicles, making it exempt from Fringe Benefits Tax (FBT) if you buy one through a novated lease. It also has plenty of grunt, though you can step up to more powerful eDrive40 and hot M50 variants if you so desire.
The Advertiser
23-05-2025
- Automotive
- The Advertiser
Australia's Luxury Car Tax could be removed gradually
The Australian Government is reportedly considering a gradual phase-out out the Luxury Car Tax (LCT) to minimise the impact on vehicle resale values, rather than axing it in one fell swoop. The Australian reports the Albanese government is assessing a progressive lowering of the controversial tax after car dealers and automakers warned its sudden removal could spark a rapid collapse in vehicle resale values. The removal of the LCT has been put on the table as the government negotiates with the European Union on establishing a free-trade agreement (FTA). However, the government reportedly won't scrap the LCT unless it can secure a better deal on agricultural exports to the EU. This had been a sticking point when previous Australia-EU negotiations on an FTA collapsed in 2023. Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now. Axing the LCT will satisfy the EU, which has been pushing for it to be abolished for at least five years. It also comes as European brands have been confronted by tariffs in the lucrative US market imposed by President Donald Trump. The Australian reports around 40 per cent ($480 million) of the total $1.2 billion annual LCT revenue is raised from European vehicle sales. With the LCT removed, the Australian Government will likely need to find a replacement source of revenue, and that could come from a road user charge. The government has had to contend with a decline in fuel excise revenue as buyers move to more fuel-efficient vehicles, as well as electric vehicles (EVs). A road user charge could see vehicle owners pay an amount based on the distance they travel, with the revenue in turn being invested in road maintenance and infrastructure. The LCT adds 33 per cent to any part of a vehicle's price above the LCT threshold. This is currently $91,387 for fuel-efficient (ie: vehicles with fuel consumption of under 7.0L/100km) and electric vehicles (EVs), and $80,567 for all other vehicles. Thresholds are set annually by the government and are indexed to the Consumer Price Index (CPI). From July 1, the definition of a fuel-efficient vehicle is changing to one with fuel consumption of under 3.5L/100km following the passing of the Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025. This change to the tax was implemented to drive uptake of more environmentally friendly models. Vehicles from Europe are also impacted by a five per cent import tariff, due to the absence of an FTA between Australia and the EU. But the proposed abolition of the LCT has been met with criticism from at least one of Labor's opponents, on the basis the government would be removing a tax from more expensive vehicles while also getting ready to impose penalties on brands that sell more popular, higher-emitting vehicles such as utes and SUVs as part of its New Vehicle Efficiency Standard (NVES). "I think it's a bit strange for the first act of a government to be giving a massive free kick to people who can afford very expensive European cars," Nationals Senator Matt Canavan told Sky News. "Why would we be making very expensive European cars cheaper while we make the average standard vehicles that Australians are struggling to afford more expensive?" In contrast, the Australian Automotive Dealer Association (AADA), the peak body for car dealers in Australia, has been among the voices domestically calling for the LCT to be scrapped, or at least significantly modified as part of a "wider root and branch review of Australia's automotive taxation regime". Calling it a "relic of an era when Australia manufactured vehicles" in its pre-budget submission this year, the AADA called for its "complete abolition". "The LCT was originally introduced as a means of protecting Australia's local vehicle manufacturing industry. With local manufacturing coming to an end in 2017, it just imposes unnecessary additional taxes on many vehicles, particularly more expensive lower emitting and EVs," the body said. The AADA argues it disincentives customers from buying new, safer and more environmentally friendly vehicles, and also penalises buyers – particularly those in regional areas – who require large SUVs and vehicle accessories that are aimed to improve safety. Vehicles from a range of mainstream auto brands, such as the Toyota LandCruiser, generate a significant proportion of LCT revenue raised, for example. "If the total abolition of the LCT cannot be achieved in a timely manner," the AADA argues, "then we propose reforms to the LCT, such as raising the threshold to target truly luxury vehicles and stage a sunset period for LCT, exempt low-emission vehicles and exclude accessories from the calculation of whether a vehicle hits the threshold forpaying the LCT." Content originally sourced from: The Australian Government is reportedly considering a gradual phase-out out the Luxury Car Tax (LCT) to minimise the impact on vehicle resale values, rather than axing it in one fell swoop. The Australian reports the Albanese government is assessing a progressive lowering of the controversial tax after car dealers and automakers warned its sudden removal could spark a rapid collapse in vehicle resale values. The removal of the LCT has been put on the table as the government negotiates with the European Union on establishing a free-trade agreement (FTA). However, the government reportedly won't scrap the LCT unless it can secure a better deal on agricultural exports to the EU. This had been a sticking point when previous Australia-EU negotiations on an FTA collapsed in 2023. Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now. Axing the LCT will satisfy the EU, which has been pushing for it to be abolished for at least five years. It also comes as European brands have been confronted by tariffs in the lucrative US market imposed by President Donald Trump. The Australian reports around 40 per cent ($480 million) of the total $1.2 billion annual LCT revenue is raised from European vehicle sales. With the LCT removed, the Australian Government will likely need to find a replacement source of revenue, and that could come from a road user charge. The government has had to contend with a decline in fuel excise revenue as buyers move to more fuel-efficient vehicles, as well as electric vehicles (EVs). A road user charge could see vehicle owners pay an amount based on the distance they travel, with the revenue in turn being invested in road maintenance and infrastructure. The LCT adds 33 per cent to any part of a vehicle's price above the LCT threshold. This is currently $91,387 for fuel-efficient (ie: vehicles with fuel consumption of under 7.0L/100km) and electric vehicles (EVs), and $80,567 for all other vehicles. Thresholds are set annually by the government and are indexed to the Consumer Price Index (CPI). From July 1, the definition of a fuel-efficient vehicle is changing to one with fuel consumption of under 3.5L/100km following the passing of the Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025. This change to the tax was implemented to drive uptake of more environmentally friendly models. Vehicles from Europe are also impacted by a five per cent import tariff, due to the absence of an FTA between Australia and the EU. But the proposed abolition of the LCT has been met with criticism from at least one of Labor's opponents, on the basis the government would be removing a tax from more expensive vehicles while also getting ready to impose penalties on brands that sell more popular, higher-emitting vehicles such as utes and SUVs as part of its New Vehicle Efficiency Standard (NVES). "I think it's a bit strange for the first act of a government to be giving a massive free kick to people who can afford very expensive European cars," Nationals Senator Matt Canavan told Sky News. "Why would we be making very expensive European cars cheaper while we make the average standard vehicles that Australians are struggling to afford more expensive?" In contrast, the Australian Automotive Dealer Association (AADA), the peak body for car dealers in Australia, has been among the voices domestically calling for the LCT to be scrapped, or at least significantly modified as part of a "wider root and branch review of Australia's automotive taxation regime". Calling it a "relic of an era when Australia manufactured vehicles" in its pre-budget submission this year, the AADA called for its "complete abolition". "The LCT was originally introduced as a means of protecting Australia's local vehicle manufacturing industry. With local manufacturing coming to an end in 2017, it just imposes unnecessary additional taxes on many vehicles, particularly more expensive lower emitting and EVs," the body said. The AADA argues it disincentives customers from buying new, safer and more environmentally friendly vehicles, and also penalises buyers – particularly those in regional areas – who require large SUVs and vehicle accessories that are aimed to improve safety. Vehicles from a range of mainstream auto brands, such as the Toyota LandCruiser, generate a significant proportion of LCT revenue raised, for example. "If the total abolition of the LCT cannot be achieved in a timely manner," the AADA argues, "then we propose reforms to the LCT, such as raising the threshold to target truly luxury vehicles and stage a sunset period for LCT, exempt low-emission vehicles and exclude accessories from the calculation of whether a vehicle hits the threshold forpaying the LCT." Content originally sourced from: The Australian Government is reportedly considering a gradual phase-out out the Luxury Car Tax (LCT) to minimise the impact on vehicle resale values, rather than axing it in one fell swoop. The Australian reports the Albanese government is assessing a progressive lowering of the controversial tax after car dealers and automakers warned its sudden removal could spark a rapid collapse in vehicle resale values. The removal of the LCT has been put on the table as the government negotiates with the European Union on establishing a free-trade agreement (FTA). However, the government reportedly won't scrap the LCT unless it can secure a better deal on agricultural exports to the EU. This had been a sticking point when previous Australia-EU negotiations on an FTA collapsed in 2023. Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now. Axing the LCT will satisfy the EU, which has been pushing for it to be abolished for at least five years. It also comes as European brands have been confronted by tariffs in the lucrative US market imposed by President Donald Trump. The Australian reports around 40 per cent ($480 million) of the total $1.2 billion annual LCT revenue is raised from European vehicle sales. With the LCT removed, the Australian Government will likely need to find a replacement source of revenue, and that could come from a road user charge. The government has had to contend with a decline in fuel excise revenue as buyers move to more fuel-efficient vehicles, as well as electric vehicles (EVs). A road user charge could see vehicle owners pay an amount based on the distance they travel, with the revenue in turn being invested in road maintenance and infrastructure. The LCT adds 33 per cent to any part of a vehicle's price above the LCT threshold. This is currently $91,387 for fuel-efficient (ie: vehicles with fuel consumption of under 7.0L/100km) and electric vehicles (EVs), and $80,567 for all other vehicles. Thresholds are set annually by the government and are indexed to the Consumer Price Index (CPI). From July 1, the definition of a fuel-efficient vehicle is changing to one with fuel consumption of under 3.5L/100km following the passing of the Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025. This change to the tax was implemented to drive uptake of more environmentally friendly models. Vehicles from Europe are also impacted by a five per cent import tariff, due to the absence of an FTA between Australia and the EU. But the proposed abolition of the LCT has been met with criticism from at least one of Labor's opponents, on the basis the government would be removing a tax from more expensive vehicles while also getting ready to impose penalties on brands that sell more popular, higher-emitting vehicles such as utes and SUVs as part of its New Vehicle Efficiency Standard (NVES). "I think it's a bit strange for the first act of a government to be giving a massive free kick to people who can afford very expensive European cars," Nationals Senator Matt Canavan told Sky News. "Why would we be making very expensive European cars cheaper while we make the average standard vehicles that Australians are struggling to afford more expensive?" In contrast, the Australian Automotive Dealer Association (AADA), the peak body for car dealers in Australia, has been among the voices domestically calling for the LCT to be scrapped, or at least significantly modified as part of a "wider root and branch review of Australia's automotive taxation regime". Calling it a "relic of an era when Australia manufactured vehicles" in its pre-budget submission this year, the AADA called for its "complete abolition". "The LCT was originally introduced as a means of protecting Australia's local vehicle manufacturing industry. With local manufacturing coming to an end in 2017, it just imposes unnecessary additional taxes on many vehicles, particularly more expensive lower emitting and EVs," the body said. The AADA argues it disincentives customers from buying new, safer and more environmentally friendly vehicles, and also penalises buyers – particularly those in regional areas – who require large SUVs and vehicle accessories that are aimed to improve safety. Vehicles from a range of mainstream auto brands, such as the Toyota LandCruiser, generate a significant proportion of LCT revenue raised, for example. "If the total abolition of the LCT cannot be achieved in a timely manner," the AADA argues, "then we propose reforms to the LCT, such as raising the threshold to target truly luxury vehicles and stage a sunset period for LCT, exempt low-emission vehicles and exclude accessories from the calculation of whether a vehicle hits the threshold forpaying the LCT." Content originally sourced from: The Australian Government is reportedly considering a gradual phase-out out the Luxury Car Tax (LCT) to minimise the impact on vehicle resale values, rather than axing it in one fell swoop. The Australian reports the Albanese government is assessing a progressive lowering of the controversial tax after car dealers and automakers warned its sudden removal could spark a rapid collapse in vehicle resale values. The removal of the LCT has been put on the table as the government negotiates with the European Union on establishing a free-trade agreement (FTA). However, the government reportedly won't scrap the LCT unless it can secure a better deal on agricultural exports to the EU. This had been a sticking point when previous Australia-EU negotiations on an FTA collapsed in 2023. Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now. Axing the LCT will satisfy the EU, which has been pushing for it to be abolished for at least five years. It also comes as European brands have been confronted by tariffs in the lucrative US market imposed by President Donald Trump. The Australian reports around 40 per cent ($480 million) of the total $1.2 billion annual LCT revenue is raised from European vehicle sales. With the LCT removed, the Australian Government will likely need to find a replacement source of revenue, and that could come from a road user charge. The government has had to contend with a decline in fuel excise revenue as buyers move to more fuel-efficient vehicles, as well as electric vehicles (EVs). A road user charge could see vehicle owners pay an amount based on the distance they travel, with the revenue in turn being invested in road maintenance and infrastructure. The LCT adds 33 per cent to any part of a vehicle's price above the LCT threshold. This is currently $91,387 for fuel-efficient (ie: vehicles with fuel consumption of under 7.0L/100km) and electric vehicles (EVs), and $80,567 for all other vehicles. Thresholds are set annually by the government and are indexed to the Consumer Price Index (CPI). From July 1, the definition of a fuel-efficient vehicle is changing to one with fuel consumption of under 3.5L/100km following the passing of the Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025. This change to the tax was implemented to drive uptake of more environmentally friendly models. Vehicles from Europe are also impacted by a five per cent import tariff, due to the absence of an FTA between Australia and the EU. But the proposed abolition of the LCT has been met with criticism from at least one of Labor's opponents, on the basis the government would be removing a tax from more expensive vehicles while also getting ready to impose penalties on brands that sell more popular, higher-emitting vehicles such as utes and SUVs as part of its New Vehicle Efficiency Standard (NVES). "I think it's a bit strange for the first act of a government to be giving a massive free kick to people who can afford very expensive European cars," Nationals Senator Matt Canavan told Sky News. "Why would we be making very expensive European cars cheaper while we make the average standard vehicles that Australians are struggling to afford more expensive?" In contrast, the Australian Automotive Dealer Association (AADA), the peak body for car dealers in Australia, has been among the voices domestically calling for the LCT to be scrapped, or at least significantly modified as part of a "wider root and branch review of Australia's automotive taxation regime". Calling it a "relic of an era when Australia manufactured vehicles" in its pre-budget submission this year, the AADA called for its "complete abolition". "The LCT was originally introduced as a means of protecting Australia's local vehicle manufacturing industry. With local manufacturing coming to an end in 2017, it just imposes unnecessary additional taxes on many vehicles, particularly more expensive lower emitting and EVs," the body said. The AADA argues it disincentives customers from buying new, safer and more environmentally friendly vehicles, and also penalises buyers – particularly those in regional areas – who require large SUVs and vehicle accessories that are aimed to improve safety. Vehicles from a range of mainstream auto brands, such as the Toyota LandCruiser, generate a significant proportion of LCT revenue raised, for example. "If the total abolition of the LCT cannot be achieved in a timely manner," the AADA argues, "then we propose reforms to the LCT, such as raising the threshold to target truly luxury vehicles and stage a sunset period for LCT, exempt low-emission vehicles and exclude accessories from the calculation of whether a vehicle hits the threshold forpaying the LCT." Content originally sourced from:
