Automotive peak body Victorian Automobile Chamber of Commerce (VACC) says the Federal Government should abolish luxury car tax (LCT) in its post-Brexit negotiations with the United Kingdom.
VACC says it’s time to drop what it claims is an “unfair tax”.
“The automotive industry is fed up with the Federal Government continually espousing its so-called free trade agreements when it maintains what has to be the laziest tax in Australia,” VACC chief executive Geoff Gwilym says.
VACC says there is no real purpose of LCT, which the Federal Government banked $640 million from during the 2018/2019 financial year, except to penalise Australians for wanting to upgrade their vehicles to a safer and more environmentally friendly model.
LCT applies to all motor vehicles $67,525 and over, including GST, and is charged at a rate of 33% for the component of the price exceeding the threshold, which can add thousands of dollars.
Examples of luxury vehicles include the Toyota Prado, Ford Ranger Raptor, Nissan Patrol and Mazda CX-9, vehicles popular with farmers and motorists throughout regional Australia.
“Ultimately, by penalising motorists wanting to buy these cars, the Federal Government encourages consumers to retain their existing vehicles longer and that just makes the Australian car fleet older, more heavily polluting and less safe,” Gwilym says.
“VACC says it’s time for the Federal Government to get real on free trade and let Australian consumers buy cars without the impost of redundant and unfair taxes.”
