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Car Industry Welcomes Vote Against Tax Hike

The peak body representing the Australian car industry, the Federal Chamber of Automotive Industries (FCAI), says the Senate’s decision not to allow the increase in the luxury car tax is an economically responsible move.

“This was always bad policy and the Senate was right to reject it,” FCAI Chief Executive Andrew McKellar said.

“This is a vital reprieve for the Australian car industry and it’s hoped that this will provide a confidence boost to the industry at a time when there are clear signs of a market slowdown,” he said.

Figures released yesterday showed a 19.3 per cent fall in sales of vehicles above the tax threshold.

“It is a sensible outcome for small businesses, particularly tourism operators, farmers and those living in rural and regional areas who would have been slugged with this unnecessary and unfair tax hike,” Mr McKellar said.

“The Senate acknowledged that many people in these circumstances rely on vehicles affected by the tax for their livelihood and safety,” he said.

The car industry says the debate surrounding this tax must not end here.

“It is essential that the luxury car tax itself now be re-examined in full as part of the review of the tax system being conducted by Treasury Secretary, Ken Henry,” Mr McKellar said.

“It remains a punitive and damaging tax and should be abolished in its entirety,” he said.

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