How $2billion of your taxes failed to save Holden as it’s revealed Australians will still be punished for buying luxury cars
- Treasurer Josh Frydenberg is refusing to scrap the controversial luxury car tax
- It kicks in at $67,525 with every dollar above threshold incurring 33 per cent tax
- Australian Taxpayers’ Alliance said tax was unnecessary without a car industry
- General Motors announced this week it would kill Holden in 2021 after 72 years
Treasurer Josh Frydenberg is refusing to scrap the controversial luxury car tax despite the imminent death of Holden.
Anyone buying an upmarket car worth more than $67,525 has to pay a 33 per cent surcharge for every dollar above that threshold.
The luxury car is here to stay, even though Australia hasn’t made cars for more than two years.
Mr Frydenberg is refusing to axe the tax, two days after General Motors announced it would kill the Holden moniker from 2021, ending 72 years of motoring history.
‘The government has no plans to phase out the luxury car tax,’ the Treasurer told Daily Mail Australia on Wednesday in a statement.
Treasurer Josh Frydenberg is refusing to scrap the controversial luxury car tax despite the imminent death of Holden. Pictured is the last Holden Commodore made in Australia, October 2017
The Australian Taxpayers Alliance, a libertarian group, said the tax could no longer be justified without a local car manufacturing industry.
‘It is time we drive the luxury car tax out of Australia,’ the group’s policy director Emilie Dye said.
‘Holden has reached the end of its road making an unfair tax more pointless.’
When the luxury car tax was introduced in July 2000, to replace existing wholesale sales taxes, Australia was home to four car makers – Holden, Ford, Toyota and Mitsubishi.
For the next 12 years after that, Holden received $2.2billion in taxpayer subsidies only to make its last Australian car in October 2017.
A red Commodore manufactured in Adelaide was also the final car to roll off an Australian production line – ending a tradition that began with Holden’s first car in November 1948.
Anyone buying an upmarket car worth more than $67,525 has to pay a 33 per cent surcharge for every dollar above that threshold. Pictured is a Mercedes-Benz C-class which incurs the tax
Victorian Liberal senator Sarah Henderson, whose home state made Fords and Toyotas, said Australia needed to get ‘good value to the dollar’ from manufacturing subsidies.
Mr Frydenberg (pictured) is refusing to axe the tax, two days after General Motors announced it would kill the Holden moniker from 2021, ending 72 years of motoring history
‘Holden has acted with a fair degree of disrespect to the government, to the Australian people, including its own workers,’ she told a Sydney Institute forum on Tuesday night.
GM’s decision to kill the Holden brand will leave 600 Australians searching for work.
Holden’s American parent company has vowed to honour existing warranties and spare parts obligations for the next decade, and will keep 200 people employed for that purpose.
Ms Dye said the government was relying on the luxury car tax for revenue, linking it to the $100million sports rorts affair which saw 684 grants go to mainly marginal seats.
‘It appears Frydenburg doesn’t want to loose a chunk of government revenue he could spend supporting his favourite sports teams,’ she said.
Former sports minister Bridget McKenzie earlier this month resigned from the ministry and as Nationals deputy leader after the Audit Office criticised her for ignoring the advice of Sport Australia, a government agency.