Article: Luxury Car Tax on the chopping board as Federal Government eyes trade negotiations with Europe
Basically, unknown sources have reported that the EU is using the LCT as a tool for free trade negotiations.
Any chance that this will actually happen?
33% of any value over the threshold.
That saves cents. Cheers
You only pay LCT on the portion of the car’s value that exceeds the threshold.
So removing it would decreases the tax of 33% on only the amount over $80,567 ( the 24/25 threshold)
So on a $100,000 vehicle it would go down by about ~$6400.
LCD?
Tell me you didn't read the linked article without saying you didn't read the article.
When using acronyms, you should always spell it out for the first time.
It was right there in the link address:
luxury-car-tax
Liquid crystal displays
Seems to me that labor would be keeping taxes that are being paid for by the more wealthy of us.
Most wealthy people I know drive inexpensive cars such as a Camry.
It is an optional tax, which is why its called a luxury car tax. Doesnt apply to a camry, shouldnt apply to a camry. But if youve got lamborghini money why shoudnt you pay a little more.
Which taxes are not optional under this 'logic'?
Plus they're using it as an incentive to promote EVs. No way I'd have paid nearly $100K for a car if I could have gotten what I wanted for nearly half that.
I would have thought you would support freer trade. You support the luxury car tax? I have heard tariffs is the most beautiful word.
Luxury car tax is not a tarriff. It applies to any luxury car regardless of origin.
Luxury car tax is not a tarriff. It applies to any luxury car regardless of origin.
What does origin have to do with it? Because there is no local car production, origin is now a moot point. When cars were produced here, local cars were exempt. So it was a tariff.
A tariff is a tax imposed by one country on the goods and services imported from another country to influence it, raise revenues, or protect competitive advantages.
https://www.investopedia.com/terms/t/tariff.asp
Depends on whether this cost would apply to locally grown product, if it existed.
If tobacco was grown locally and not taxed, but imported tobacco was taxed, this would be a tariff. If they were both taxed, then this would just be a simple tax.
The 'luxury' car tax only applies to imports… this is what it was designed as- a tariff to protect domestic production. Then local production ceased. It's still a tariff- if by some magic a factory appeared and started pumping out $200K cars, they would not be subject to the LCT.
@rumblytangara: So it was a tarrif at one point, and by that definition is no longer a tarrif, but could become a tarrif again if we made cars here.
So a tarrif in spirit, but not by definition.
So a tarrif in spirit, but not by definition.
It is one hundred percent a tariff under legal and economic definition. It's a levy imposed on a type of product imported from overseas only. Whether there is local production is irrelevant.
A "tariff" is simply a specific subclass of the umbrella term "tax" and in this case for cars of 80K, it remains both. It is a tariff, and effectively it's also a universal tax on cars over the threshold price. Just because there are no locally manufactured cars anymore doesn't mean that the tariff has disappeared.
If electric toothbrushes are a subclass of toothbrushes and all manual toothbrushes vanished off the market, then the remaining electric toothbrushes are still… both toothbrushes and electric toothbrushes.
This is the weirdest conversation I have ever had on this forum. One of us is clearly missing something here, maybe it's me (but I don't think so?)
Edit: I have just realised that one of us consistently knows how to spell "tariff" that the other doesn't. That might be a bit of a clue about which one of us has a better idea of what whether something is a tariff or not.
Happy to keep the tax on more expensive cars.
Helps push prices down, and if you're buying expensive you can either afford it or you're a Muppet and would over spend anyway.
People don't need to be spending stupid amounts on cars.
Ridiculous tax that ought to have been dumped or severely curtailed ages ago.
$82k vehicles are not luxury by any stretch.
Chances of ALP dumping it? Less than 10%
$82k vehicles are not luxury by any stretch.
Wha…? They certainly arent base model rides.
If you're paying more than $50k for a car you're overspending.
$82k vehicles are not luxury by any stretch.
They objectively are, it's just that people have been conditioned to believe that they need to own expensive European cars to keep up with the other parents at school drop-off and pick-up.
Just to put it into perspective, every single mainstream passenger car sold by all of the mainstream brands are below the LCT threshold - e.g. from Toyota, Mazda, Hyundai, Kia, BYD, Tesla…etc.
If you are seriously suggesting that anyone is starved for choice below $82k, then I don't know what to say. It's obviously the case that everyone spending over $82k is buying luxury, not a mainstream passenger car.
Fairly standard models now are $60-70k.
EV allowance on LCT is $90k ish.
LCT, if retained, should be for luxury vehicles. Want a Lamborghini? Sure. Aston Martin? Yep.
Land Cruiser? Oh common….
Fairly standard models now are $60-70k.
Corolla starts at $32,990, Camry starts at $39,990, RAV4 starts at $42,990.
What are the "standard" cars which are $60-70k?
Even so, $60-70k is still well below the LCT threshold.
What non-commercial (as they are exempt) cars above the LCT threshold do you consider to be "normal" cars? Do you have any examples?
Land Cruiser? Oh common….
LandCruiser is already exempt from LCT if it is used for commercial purposes.
luxury car buyers should pull themselves up by the bootstraps and grind harder
It was originally set just above the price of a Holden Statesman and Ford Fairlane, the cars of choice for chauffeured parliamentarians.
Those Statesman and Fairlanes are now in the hands of brainless hoons. It's the circle of life, or something.
If there's any group of people who ought to be taxed more, it's people who buy luxury cars (or any luxury goods for that matter).
Every single mainstream passenger car sold by the mainstream brands (e.g. Toyota, Mazda, Hyundai, Kia, Tesla, BYD…etc.), and even many of the cars sold by the premium brands (e.g. Mercedes, BMW, Audi…etc.) are below the LCT threshold. It's not like you're starved for choice.
People who make such poor financial decisions as to purchase a luxury car above the LCT threshold to show-off to the other parents at school pick-up probably can spare a few dollars to fund nuclear submarines (or whatever else the government's spending these days) that are equally poor financial decisions.
Tax (significantly) on large engine capacity/high horsepower vehicle instead. Will remove a lot of those soccer mum trucks off the road.
Won't be long before these grubs start a new tax on houses valued at over, $xxx million.
Nice try. The LNP have, factually, been higher-taxing than Labor.
This has existed for ages. Additional stamp duty on houses over 3M.
Maybe new houses only…
Should've happened 25 years ago
Neither for or against LCT, but it seems poor policy to touch a $1.2B revenue that no one is complaining about.
It also has an effect to push up prices of cars that are sitting just under the LCT threshold.
No doubt it will also encourage more large UTEs on the road once they are LCT-free.
So existing "luxury cars" will lose 33% value overnight? Ouch!
IMHO it should have progressively been phased out after Ford and Holden stopped manufacturing here