More on luxury car tax and the announcement this week by Treasurer Jim
Chalmers that from July 1, 2025, the definition of a fuel-efficient car will change
from one that currently doesn’t use more than 7L/100kms to one that doesn’t use
more than 3.5L/100km. The result will mean that a lot of previously exempt diesel,
petrol, and hybrid vehicles will now become liable for a luxury car tax of 33 per cent,
pushing the price of many vehicles up. Frankly, luxury car tax is a misdemeanour,
many vehicles that will be caught by this are from luxury including many 4WDs –
and the Federal Chamber of Automotive Industries is right in long calling for the
tax’s abolition. Luxury boats, planes, and jewellery are not subject to a luxury tax
so why does the car industry have to carry the full burden of the tax?

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