Luxury Car Tax is payable to the Australian Tax Office for all vehicles purchased whose price exceeds the luxury car tax threshold (currently $59,133 for the 2012/2013 financial year (increased from $57,466 in 2010/2011)) except for the cases described below. Australia has one of the toughest taxing systems for new cars in the developed word and despite this particular tax being pitched as a ‘luxury car tax’, it affects an increasing number of what most poeople would consider mainstream new cars.
Thankfully, Luxury Car Tax is payable only on the purchase amount exceeding this limit – not the entire purchase price.
In short, Luxury Car Tax is calculated as 33% of the GST exclusive portion of the vehicle purchase price over $59,133. It can be calculated using the following steps:
The Luxury Car Tax should then of course be added onto the GST inclusive price of the car. The supply price for the above example would be $112,260
There are a number of cases where Luxury Car Tax does not apply on vehicle purchases over $59,133:
For more information on Luxury Car Tax, please download the following publication from the ATO – luxury_car_tax2.pdf (378.39 Kb)
Another important consideration for your new vehicle purchase other than luxury car tax is stamp duty. Click here to find out about how stamp duty affects vehicle purchases in your state and how LCT calculations may change in 2012/2013