Following the closure of the local car industry, dealers, manufacturers, and the public is looking forward to some improvement in duties and taxes.

 

Unfortunately, the 33% Luxury Car Tax (LCT) and import duties still exist despite Senator David Leyonhjelm calling them a tax on a tax on a tax on a tax after adding in GST and state duties.

 

According to David Blackhall, the 2018 Federal Budget was an "opportunity to modernise the taxation regime for new cars".

 

"Unfortunately, both the passenger vehicle tariff and the luxury car tax remain on the books and will collectively generate almost $1.3 billion in 2018-19, significantly more than previously forecast," Blackhall said.

 

"The sale of new cars brings significant societal benefits as they are safer, more environmentally friendly and more fuel efficient. Improving road safety, reducing vehicle emissions and bringing down energy costs are all Government priorities and these taxes hinder progress towards these goals."

 

"Increased taxes on the sale of new cars by various levels of government simply force consumers to pay more and in the process hurt many of the people working in the automotive industry, such as sales staff, finance providers and workshop technicians."

 

Mercedes-Benz, however, is hopeful that the current free-trade agreement with the EU will lead the way to the abolishment of the 33% Luxury Car Tax.

 

How it will be phased out? That is for the Government to figure out and for the public to see.

 

AADA strongly stands for the abolition of the LCT - an unfair, regressive tax that impacts negatively on car affordability and, some argue, is hindering the adoption of electric vehicles.