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How does the luxury car tax work?

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I’m in the market for an imported car but I have been told that there is a luxury car tax. Could you explain how that works?

A tax of 33 per cent is imposed on luxury cars, which are sold above the luxury car tax threshold. The threshold is $57,466 and this includes the GST-component of the price. This becomes an important price point as many cars are priced to avoid the big uplift in price that happens because of the luxury tax. Some cars priced over the threshold, such as camper vans, don’t get slugged and so it is worth doing your homework on what does and does not attract the tax. The website has a booklet that you can download to discover the lowdown on the luxury tax.

For advice you can trust book a complimentary first appointment with Switzer Financial Services today.

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

Published on: Monday, February 14, 2011

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