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.

Tags: about-carsguide, browse, car-finance, cars, ebay, home, mobile, motoring-news, photos, place-an-ad, privacy, privacy-policy, real-estate, search, sell-your-car, sponsored-links, used-cars, value-your-car, videos

This entry was posted on Wednesday, September 24th, 2008 at 6:12 am and is filed under cars. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.