Senate Obstructionism

2020hindsight · 5 September 2008

http://www.privatefleet.com.au/index.php?itemID=228
(a website which says it in plain english) ..

Luxury Car Tax is payable to the Australian Tax Office for all vehicles purchased whose price exceeds the luxury car tax threshold (currently $57,009) except for the cases described below.

Luxury Car Tax is payable only on the purchase amount exceeding this limit - not the entire purchase price.

In short, Luxury Car Tax is calculated as 33% of the GST exclusive portion of the vehicle purchase price over $57,009. It can be calculated using the following steps:-

example of a car costing $100K GST inclusive ... (becomes $112, 863 with 33% LCT - compared to about $3100 less than that at the moment with 25% LCT)

(but these people have a vested interest in getting people to "beat the rate hike"

Calculate the amount subject to LCT. Take the full price of the vehicle and subtract $57,123. For example a vehicle whose GST inclusive price is $100,000 has $100,000 less $57,123 which equals $42,877 subject to Luxury Car Tax

Find the GST exclusive portion of the above figure. The easiest way to do this is to multiply the figure by 10 and then divide by 11. In the above example: $42,877 x 10 / 11 leaves $38,979

Thirdly multiple this above figure by 33% to calculate the LCT component on the vehicle price. In our example $38,979 x 33% leaves $12,863 of luxury car tax.

The Luxury Car Tax should then of course be added onto the GST inclusive price of the car. The supply price for the above example would be $112,863..

Exemptions

There are a number of cases where Luxury Car Tax does not apply on vehicle purchases over $57,123:

if the vehicle was sold or imported prior to 1st July 2000

if the car is supplied over two years following the local build date or, if imported, the vehicle compliance date.

if it is an emergency vehicle (eg ambulance etc)

if it is not GST-free and is specially fitted out for transporting disabled people seated in wheelchairs

if it is a campervan or motor home

if it is a commercial vehicle that is not designed for the principal purpose of carrying passengers.

if the vehicle is supplied by private sale

For more information on Luxury Car Tax, please download the following publication from the ATO - luxury_car_tax2.pdf (378.39 Kb)

Another important consideration for your new vehicle purchase other than luxury car tax is stamp duty. Click here to find out about how stamp duty affects vehicle purchases in your state.

There will be other on-road costs of course.

In the end the car probably costs $117K or so - of which $3K is the proposed increase in LCT.

And as mentioned elsewhere, a car costing $57K has zero increase.

Beej · 5 September 2008

Buddy said:
I've got another solution. Maybe we should have like a "Roman Senate" where there were no "political parties", just a free for all with everyone getting their say. Then after the debate if you don't like what the other Roman voted for, you kill him.

Even the Roman senate ended up being controlled by major "factions" that would vote as a block one way or the other. The most famous being the "conservative" faction lead by Cato vs Julius Ceasers faction, before they took option B) as you point out - which was to kill him

Cheers,

Beej

2020hindsight · 5 September 2008

People have mentioned a heap of taxes that they don't like ..
perhaps we could analyse who lowered many of them
Customs Duty for starters ? - any offers..

2020hindsight · 5 September 2008

meanwhile the traders are in confusion ....

(and you'd better believe that all this stuffing around will cost us taxpayers )

http://www.aph.gov.au/Senate/commit..._luxurycars_08/submissions/sub02_attach_D.pdf

or this from 25 June...

http://www.vacc.com.au/NewsAdvocacy...CTaridiculousshambles/tabid/2610/Default.aspx

“The LCT is to increase without the approval of the Parliament and, as a result, new car dealers are placed in an intolerable situation in having to apply a tax that is not yet law, and may not pass the Parliament when the Bill is returned.

“Car dealers are faced with the ridiculous situation of having to say to customers –‘You can pay this tax now, but if the legislation is defeated we’ll give you a refund on the amount later’. Or, ‘if you don’t pay this tax, and the legislation is passed, we’ll get the tax off you later on’.

“How absurd. How could a sales contract possibly reflect such a ridiculous situation? Buyers will have every right to say, ‘it is not law and I don’t want to pay’,” VACC Executive Director, David Purchase, said.... etc

2020hindsight · 5 September 2008

As for who started all this ... July 2000 sounds like Howard / Costello to me ..

and lol , I don't recall you blokes objecting at the time - then again you have a good excuse, ... ASF was probably just a twinkle in Joe's eye

http://www.privatefleet.com.au/images/upload/documents/luxury_car_tax2.pdf

Let's face it , some of you blokes are not being fair here (lol) :

2020hindsight · 16 September 2008

http://www.abc.net.au/news/stories/2008/09/16/2366223.htm

Turnbull warned against 'vandalising' Budget surplus
By Online parliamentary correspondent Emma Rodgers

Posted 5 hours 13 minutes ago
Updated 4 hours 55 minutes ago

Federal Treasurer Wayne Swan has warned newly elected Opposition Leader Malcolm Turnbull against vandalising the Budget surplus in the face of increasing global economic turmoil.

The Treasurer made the warning to Mr Turnbull as he led the Coalition in the Parliament for the first time today, after beating Brendan Nelson in a leadership spill this morning.

Mr Swan accused Mr Turnbull of already blowing "$20 billion in 20 minutes" by remaining committed to Coalition Budget blocking policies in a media conference this morning.

"He wants to raid the surplus to the tune of $6 billion and then he recommitted to a whole set of spending requirements which had been outlined by the previous Leader of the Opposition," he said.

"That's not responsible economic management, that's not responsible economic leadership, it is not what this country requires at a time of global uncertainty."

The Government has calculated that the Opposition's moves to block several pieces of Budget legislation and its spending promises will take $20 billion out of the Budget.

jeflin · 16 September 2008

Beej said:
Even the Roman senate ended up being controlled by major "factions" that would vote as a block one way or the other. The most famous being the "conservative" faction lead by Cato vs Julius Ceasers faction, before they took option B) as you point out - which was to kill him

Cheers,

Beej

That will clear the Senate of a lot of deadwood.

moXJO · 17 September 2008

2020hindsight said:
People have mentioned a heap of taxes that they don't like ..
perhaps we could analyse who lowered many of them
Customs Duty for starters ? - any offers..

Ummm... I don't like taxes from either side. It wasn’t a competition between labor and liberal as to who brought out the most (or cut the most) taxes. I would rather see the money they do get be better spent before a tax grab. I don't support the libs raising taxes either.

Labors policies were mostly lifted from the libs anyway I thought?

2020hindsight · 24 September 2008

Buddy said:
What, you havn't worked out that this is just another tax? Read my lips. TAX!

and the Senate even objects to reduction in tax lol. (Medicare Levy).

http://www.abc.net.au/news/stories/2008/08/20/2340840.htm

Senator Xenophon says if the surcharge was indexed to inflation it would kick in when a person is earning more than $75,000.

2020hindsight · 24 September 2008

PS and (though I haven't double checked Nick Xenophon's comment) it sounds like it's just catching up with "bracket creep" of a sort. - back to Johnny Howard's 1997 numbers.

http://www.plugger.com.au/like/medicare_levy_surcharge_thresholds/2420485/

The ‘stick' of the Medicare levy surcharge introduced by the previous government in 1997 to encourage middle-income earners to purchase private health insurance is without indexation. This means that it is now capturing people on much lower relative incomes who can less afford private health insurance. The Greens agree that, in the interests of fairness, this issue should be addressed.

Green08 · 24 September 2008

I have a friend who has a porche, he had it serviced recently and was asking the sales guy who sold it to him how business was lately. His reply "We're averging 1 car a month!" His salary is 80% commission. He said at this rate he would make more money working making pizzas. They used to sell several a week. My friend estimated with leases, salaries etc they would be out $200,000 a months minimum.

If car dealerships begin to close I hope they have the sense to keep the service departments open - they would be in breach of contract from overseas if they don't.

If you can afford the car and knowingly take repossability for it you should not be penalised. Sure you maybe paying for the 'badge' but in many instances you are paying for safey and hours of someone developing, engineering a better car.

I have a honda - goes from a - b. But has to be serviced the recommended 6 months or 10,000 kms. I average 6,000 km a year! So already to keep the warranty it is @ 2 services a head of itself and getting expersive.

If I could be a car I would buy a Mercedes which are only serviced at the given times you reach on the odometer. The engines are brillant a CLK engine is constructed by one person and has their signature on it. They have incredible safety features and amazingly environmental friendly. All parts of a Mercedes can be recycled. My dad's Mercedes saved my family's lives when we were hit by a car doing 100kms and slammed into us on a T junction.

I agree with Julia that there are people who need vechiles for genuine purposes. There should be no luxury car tax.

2020hindsight · 24 September 2008

green08 said:
If I could be a car I would buy a Mercedes ....... My dad's Mercedes saved my family's lives when we were hit by a car doing 100kms and slammed into us on a T junction.

I agree with Julia that there are people who need vechiles for genuine purposes. There should be no luxury car tax.

well green, it won't apply to people on the land and/or tourism trade (assuming I heard it right) - (AND tax deductable for them in any case).

and even a Mercedes (some models) can be purchased in Australia for well under $60K on the road ( where LCT is nil/zilsh. ) - except for the CL and some of the other modles maybe

http://carshowroom.autotrader.com.a...ype=detail&customer_id=2196&referrer=googlecs

"Browse the new Mercs for 2008 / 2009..."

Julia · 24 September 2008

2020hindsight said:
and the Senate even objects to reduction in tax lol. (Medicare Levy).

[

2020, that is a really simplistic comment. The ramifications of the change in income level for the Medicare Levy were enormous and I'm relieved that the government's Bill has been defeated. In every State the hospitals are dysfunctional. What do you think would have been the result when so many people dropped their private cover and lined up for treatment in their public health systems?

Imo it was one of the silliest and most thoughtless proposals anyone could have come up with and its rejection is a rare victory for common sense.

2020hindsight · 24 September 2008

Julia said:
2020, that is a really simplistic comment. The ramifications of the change in income level for the Medicare Levy were enormous ....

ahh yes Julia,
but so too are the ramifications of reducing petrol guzzlers

2020hindsight · 25 September 2008

PS I was mainly reacting to Buddy's comment "read my lips, TAX" - I agree with you that there is more to this than just dollars to the govt. (or even from the govtin this case).

I don't see this particular matter - i.ethe need to pass this particular bill - as very important btw. (even though it's just catching up with bracket creep back to 1997 - although that is inconsistent with the LCT where $57K remains un-indexed)

Then again "330,000 Aussies will pay up to $1500 less medicare levy tax"apparently.

http://www.abc.net.au/pm/content/2008/s2373519.htm

JULIA GILLARD: Now it seems even with a new leader, the Liberal Party is in intent on derailing the Government's fiscal policy direction.

But to take one example of this, the position of the Liberal Party on the Medicare Levy Surcharge, shows just how out of touch it is; out of touch with the needs of this nation to deliver a budget surplus, and out of touch with Australians.

This is a measure that would provide 330,000 Australians with up to $1500 in tax relief per year.

I fail to see how this particular matter will help deliver a budget surplus, lol.

NICOLA ROXON: ........ which government was it that pulled a billion dollars out of our public hospital system?

(I agree Julia), even if the Govt plan to improve the public hospital system, it doesn't seem to be a real good idea (on first impression) to change the private insurance situation before they improve the hospitals (imo).

(But I disagree with senate obstructionism on alcopops and on fuelwatch and, for a while, on LCT)

Uncle Festivus · 25 September 2008

Julia said:
The luxury car tax is rubbish for the price bracket to which it applies, as I understand it. If it were just to apply to top end Rolls Royce, exotic sports cars etc, then OK, but to penalise people like farmers and tourist operators who simply need four wheel drives is stupid.

Feilding doesnt have a clue. He's gotten his 15 minutes, due to the undemocratic system we now have - Keatings' genuine unrepresentative swill.

I'm a farmer, surrounded by struggling farmers. We don't need to buy a vehicle costing $60k to do farm work; as if a struggling farmer can even afford a luxury car.

A $35k tray back 4wd ute will suffice for those genuine farmers. In tough times I can guarantee that farmers won't even buying the $35k ute, let alone spending $60k on any vehicle.

As for the Greens, it's the one bit of common sense that has come out of them for years - make it hurt the hip pocket for those who can't resist buying environmentally damaging cars - and who can afford it.

There are plenty of good, safe, and efficient cars to be bought for under $60k eg Subaru, Honda, etc.

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