Prados and LandCruiser the ones paying luxury car tax price

Toyota buyers pay more LCT than any other brand.
Toyota buyers pay more LCT than any other brand.

GUESS which manufacturer's customers pay the most in luxury car tax?

Mercedes-Benz, BMW, Audi? No. The winner, or loser, is Toyota.

Cars such as the Toyota LandCruiser and Prado are reaping more for the government than anything coming from the premium genre.

Mercedes-Benz has been the most vocal opponent of the tax in recent years, but Toyota is now also singing from the same hymn sheet.

From this month, the luxury car tax threshold has risen to $61,884 in line with CPI - an increase of $1568.

To offset the rise, Toyota has dropped the prices of 19 of its more expensive models by up to $470 but slammed the Federal Government in the process.

Toyota's executive director of sales and marketing, Tony Cramb questioned why there was no equivalent tax on items such as jets, antiques, yachts, motor boats and jewellery.

"Australian motorists are already heavily taxed with GST, stamp duty and registration fees when buying a new car, as well as road tolls and a hefty tax on fuel," Mr Cramb said.

"New vehicle buyers should not be singled out to pay the additional burden of a so-called luxury tax - especially one that is so inefficient and poorly designed.

"Application of the tax does not recognise that many vehicles in this category offer important safety, environmental and theft-reduction benefits. "

The luxury car tax threshold remains at $75,375 for vehicles with an official combined fuel consumption rating that does not exceed 7.0 litres/100km.

While pleased that Toyota has entered the debate, the automotive sector is not holding its breath waiting for change.

Mercedes-Benz senior manager of corporate communications David McCarthy said it had always been a "tax on technology", and couldn't see the government knocking back the $500 million it raised annually.

"We all know the tax doesn't make sense. No sense at all," he said.

"It's irrational, it's been condemned by the European Union, and even the Henry Tax Review said it should be abolished.

"The reality is, politically it's very difficult to remove. We proposed a couple of years ago to replace it with an emissions tax. But the race has definitely been run. The time for manufacturers to get together on this was a long time ago."


  • LCT is a tax of 33% on luxury cars sold or imported where the value of a car exceeds the luxury car threshold.
  • LCT only applies to the amount above the luxury car threshold.
  • The threshold increased to $61,884 on July 1.
  • Vehicles with a combined fuel consumption less than 7.0 litres/100km have a threshold of $75,375.

Topics:  cars news mercedes-benz toyota

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