Toyota Australia Attacks ‘Inefficient’ Luxury-Car Tax
Toyota Australia sales and marketing chief Tony Cramb says the tax should be abolished, especially because there is no equivalent tax on items such as antiques, yachts, motor boats and jewelry.
Australian industry leader Toyota renews its attack on the federal luxury-car tax, calling on politicians to abolish the levy, labeling it discriminatory and inefficient.
The automaker speaks out after the Australian Tax Office announces the threshold was raised to A$61,884 ($58,513) on July 1, up from A$60,316 ($57,026) the previous financial year.
Toyota Australia is passing the full cost savings to consumers resulting from the inflation-related increase in the threshold for the tax.
As a result, the recommended retail prices of 19 Toyota Land Cruiser 200, Land Cruiser Prado, Kluger and Tarago vehicles have fallen – 17 of them by the maximum of A$470 ($444).
Toyota’s Sales and Marketing Executive Director Tony Cramb says the luxury-car tax should be abolished, especially because there is no equivalent tax on items such as antiques, yachts, motor boats and jewelry.
“Australian motorists are already heavily taxed with GST (Goods and Services Tax), stamp duty and registration fees when buying a new car, as well as road tolls and a hefty tax on fuel,” Cramb says in a statement.
“New-vehicle buyers should not be singled out to pay the additional burden of a so-called luxury tax, especially one that is so inefficient and poorly designed.”
The punitive tax rate originally was 25% on the value of the vehicle above the threshold, but was increased to 33% in 2008.
“Application of the tax does not recognize that many vehicles in this category offer important safety, environmental and theft-reduction benefits,” Cramb says. “The tax also results in significant compliance costs that are borne by our dealers.”
He says Toyota's opposition to the tax and its call for its repeal is consistent with the recommendations of a government-ordered review of Australian taxes.
Under the Australian constitution only the federal government, not the states, has the power to impose taxes.
The luxury-car tax threshold remains at A$75,375 ($71,267) for vehicles with an official combined fuel consumption rating that does not exceed 33 mpg (7.0 L/100 km).
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