Luxury Car Tax Bites Australians

December 19, 2017 Taxation in Australia

Luxury Car TaxCANBERRA – Australia’s appetite for luxury cars is proving to be a financial windfall for the government.

Information contained in the Mid-Year Economic and Fiscal Outlook released by the government of Australia has shown that the amount of tax revenue collected from the sale of luxury automobiles is rising beyond expectation.

All cars sold by a registered dealer in Australia are liable for a Luxury Car Tax if their sale price is above AUD64 132, or AUD 75 526 in the case of cars with a fuel efficiency exceeding 7L/100km.

The tax is levied at a rate of 33 percent on the portion of the price which exceeds the applicable threshold.

In the current financial year the tax is expected to lead to revenues of approximately AUD 680 million, a level which is nearly AUD 30 million higher than was originally forecast.

In the coming financial year the gap between current and previous expectations grows to AUD 60 million, as the total climbs to AUD 700 million.

Over the coming four years the tax is expected to bring in as much as AUD 2.9 billion, an estimated AUD 220 million more than initially forecast.

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