The 33 per cent tax on luxury cars has become a bargaining point in negotiations with the bloc
The EU is keen to see the luxury car tax go in the “give and take” of free trade negotiations.
Australia’s automotive industry peak body says the country should scrap the tax in exchange for better market access for agricultural industries while one of the EU’s top trade negotiators, Bernd Lange, says the bloc is keen to see the tax go in the “give and take” of negotiations.“We are producing wonderful cars and in Australia, we have this luxury tax on cars, so let’s see,” said Lange, who chairs the European Parliament’s committee on international trade.“I’m sure the luxury car tax is one.
Federal Chamber of Automotive Industries chief executive Tony Weber said scrapping the tax would give Australia more negotiating room, opening up opportunities for sectors such as agriculture to gain better European market access. A German-made BMW iX electric SUV has a base price of nearly $113,000, which includes the 5 per cent tariff paid by the manufacturer of about $5000 to $6000, and Australian buyers then need to add about $12,000 in GST. After GST is counted, nearly $14,500 in luxury car tax is added – taking it to a total of roughly $139,500, before stamp duty and registration.