Explanatory MemorandumCirculated By the Authority of the Treasurer, the Hon Wayne Swan Mp
General outline and financial impact
Amendment for a fuel-efficient car limit under the luxury car tax
This amendment establishes a new luxury car tax threshold for fuel-efficient cars.
This amendment achieves this objective by introducing a fuel-efficient car limit into the luxury car tax law and applying it to cars with a fuel consumption not exceeding 7 litres per 100 kilometres.
The fuel-efficient car limit will be initially set at a threshold of $75,000 and indexed annually in the same manner as the luxury car tax threshold. The limit will apply to cars with a fuel consumption not exceeding 7 litres per 100 kilometres as a combined rating under vehicle standards in force under section 7 of the Motor Vehicle Standards Act 1989 .
Date of effect : Royal Assent.
Financial impact : This amendment to reduce the luxury car tax applicable to fuel-efficient cars will have the following financial implications:
Compliance cost impact : Minimal, under the Motor Vehicle Standards Act 1989 new cars are required to display the combined fuel consumption rating prior to the time of sale.