AUSTRALIA’S appetite for luxury cars will provide an extra $220 million windfall for the Federal Government, the latest Budget figures show.
The Coalition yesterday released its Mid-Year Economic and Fiscal Outlook, a gauge of how the government’s revenue and expenditure measures weigh up against the official figures for the 2017-18 financial year released in May.
The guesstimates that reach out to the 2020-21 financial year tell us one important thing: rumbles that the Government plans to scrap the controversial the Luxury Car Tax (LCT) appear misguided, with the federal bean counters anticipating the tax will skim more than $2.9 billion out of luxury car buyers’ bank accounts over the next four years – $220 million more than anticipated in the Budget.
The LCT is expected to raise $680 million this year alone – a rise of $30 million over budget forecasts – and $700 million next financial year, a rise of $60 million over the original Budget estimate.
The shutdown of Australian car manufacturing is providing another windfall for Government, with customs duty on new passenger cars as Australia rushes to another record annual sales result now expected to hit $480 million this financial year, $10 million up on May’s estimates. The numbers also point to something dramatic happening to the new-car industry in the 2020-21 financial year, with expected revenue from customs duty in the sector jumping dramatically from $490 million in 2019-20 to $550 million.
There’s some upside in the mid-year assessment, though. The amount of money raised via the twice-yearly adjusted fuel excise on petrol this financial year has revised downwards, falling from Budget estimates of $6.25 billion to just $6.2 billion, handing $50 million back to motorists. In following years, the amount of money raised by the excise is expected to fall significantly under the original estimates, saving motorists up to $300 million a year.
If you fuel your vehicle up via the diesel pump, however, be prepared to pay more into the government’s coffers. Despite sales of diesel-engined vehicles all but stalling in Australia, the revised budget figures show oil-burners will contribute up to an extra $100 million a year.