VACC slams Senate decision to vote in LCT

Carsguide

24 September 2008

The Government's legislation seeks to lift the luxury car tax, which applies to cars worth more than $57,180, from 25 per cent to 33 per cent.

Victoria’s peak automotive industry body, the VACC, has slammed the Senate’s decision to vote through the increase in Luxury Car Tax (LCT), even with the concessions to farmers, tourism operators and low-emission vehicles.

After rejecting the increase initially, the Senate has approved an increase in the tax from 25 percent to 33 percent after a second round of voting.

“This is an unsatisfactory outcome, made worse by further exemptions. It makes the Luxury Car Tax more confusing than ever,” VACC Executive Director, David Purchase said.

“The concessions to the minor parties simply muddy the issue and, for car dealers, will add to the complexity of applying this unjustified tax.”

The Senate yesterday rejected an Opposition proposal to have the Government's planned luxury car tax increase applied only to vehicles worth more than $90,000.

All seven balance of power senators sided with the Government to vote down the Coalition amendments, 36 to 34.

The Government's legislation seeks to lift the luxury car tax, which applies to cars worth more than $57,180, from 25 per cent to 33 per cent.

An amendment by the Greens would exempt cars priced up to $75,000 if they use less than 7.0L/100km of fuel.

The Coalition yesterday sought to amend the Government's Bills so that only vehicles worth more than $90,000 would be taxed at the increased rate, while cars worth between $57,180 and $90,000 would be taxed at the current rate.

The Coalition believed such a change would ensure people with 4WDs and people movers would not be slugged with the increase.

The deputy leader of the Government in the Senate, Stephen Conroy, attacked the Opposition's proposal.

"This is just another part of the raid on the budget surplus,” he said.

"By lifting the tax threshold, they are giving a tax break to Porsche drivers.”

VACC now hopes the Henry Inquiry into taxation will have the courage to tackle the issue of Luxury Car Tax and recommend it be abolished.

“It is the VACC’s view that LCT is out-dated and unjust. How can cars attract a unique additional tax, when other ‘luxury’ items such as plasma TVs, holidays, and yachts do not?” Mr Purchase said.

Comments on this story

Displaying 3 of 8 comments

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For starters cars are overpriced. Realsitic car prices that correspond to the wages and debt riding ability of ordinary Australians is a start. However, the greed that predisposers luxury buyers to Beemers Mercs and even Volvos should be taxed. if your life is so rich that you can pee money away on a car that pricey is disgusting. About time.

Brent of Melbourne Posted at 30 September 2008 11:09pm

cant even buy a decent family car for under the 57000 dollar mark , just another way those scumbag convict politician bastards rip off the working man.

mick of yeppoon Posted at 30 September 2008 6:40pm

Just goes to show how out of touch with reality our politicians are. They simply have no idea!!!

Steve Cox Posted at 30 September 2008 3:08pm

out with Kevin07,he is an idiot.

alex hodi Posted at 28 September 2008 6:29am

Disgraceful tax increase, unjust. Heh, did anyone notice how many Pollies denegrated 'specifically' Porsche Owners/Buyers, wow, now I know whom to blame for Australia's woes (not).

deejay51 of Gold Coast Posted at 25 September 2008 10:31am

Stephen Conroy your an idiot! This tax doesnt benefit Porsche drivers even if the Coalitions changes applied. Since when mr Conroy can u buy a new Porsche 4 90K. You'll need another 20K for the base model Porsche, maybe you should do your homework! Bob Brown, just how many cars only sip 7.0L per 100km? Not many on my count and most of those are under the $57K anyway. And seriously what can we buy for around $60K anyway! Normal average Australians pay this amount for a family 4wd or nice Falcadore. If the legistlation was helping create jobs why not make all Australian built cars exempt from the increase? This would protect what little car industry we have left! I believe the tax should make Australian built vehicles exempt. This would encourage people to buy our own.

joshua morley of Brisbane Posted at 25 September 2008 10:20am

"By lifting the tax threshold, they are giving a tax break to Porsche drivers.” You won't find a modern Porsche under $90,000 so for the government to use this as an attack just proves how truth-bending and false they really are. The Oppositions argument is far more logical. $57,000 will barely buy you a luxury car these days ($90,000 I think is very reasonable - still plenty of cars above that to get your tax from Labor) and Libs' argument about ensuring 4WD buyers (some people NEED 4WDs) and people mover buyers aren't unfairly luxury taxed on their non-luxury vehicles is a much better and realistic argument. But why would ANYONE support this move anyway? This is just another tax. Who wants to be taxed extra? This is ludicrous - just another tax introduced by Labor.

the alex of brisbane Posted at 24 September 2008 8:37pm

Awesome... Accoding to Stephen Conroy, I can get a Porsche for 90k !!! Which dealer is doing those deals?

DM Posted at 24 September 2008 6:13pm

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