Victorian Luxury Car Tax cash grab

In the recently released 2019/2020 budget by the Victorian State Government, there are proposed changes to the Luxury Car Tax amounts. These changes have been deemed purely a cash grab by Tony Weber, chief executive of the Federal Chamber of Automotive Industries (FCAI).

Currently, the Victorian Luxury Car Tax (LCT) threshold is set to $66,331, however is set to increase to $67,525 in the 2019/2020 financial year. Any vehicles priced above the new threshold will incur LCT stamp duty of $10.40 per $200, up from $8.40 per $200 in the 2018/2019 financial year. Where this further becomes concerning, is that vehicles priced between $100,000 and $150,000 will attract a tax of $14 per $200. Vehicles priced above $150,000 will incur a stamp duty of $18 per $200.

A vehicle priced at $150,000 may seem like a lot, however with a 200 Series Toyota LandCruiser VX / Sahara, you’re looking at around the$105,000 to $130,000 mark off the showroom floor; which is under the $150,000 Luxury Car Tax threshold. That said, when you start to add accessories – bull bar, snorkel, suspension, wheels/tyres, lights and roof cages – your total package can quickly breach the threshold.

Tony Weber, chief executive of the FCAI said, “It is money grabbing at its worst. But what’s more disturbing is that it is a tax on safety and technology. It targets vehicles that introduce innovative safety and technical features to the market. And the vehicle which attracts the most LCT is a Toyota LandCruiser – a popular vehicle for families and landholders. Hardly a luxury vehicle.”

The increase is no new thing however, with Queensland already increasing their LCT to similar levels after their last election. This paints a rather bleak picture for the state of the country, with apparently more states set to jump on the bandwagon, purely as a cash grab tactic.

“The fact that states and territories are now considering and implementing this tax is beyond rational belief,” Weber said.

Let us know in the comments below your thoughts on the Victorian Luxury Car Tax cash grab, and whether these changes would push you to chop your 200 Series to circumnavigate the LCT.


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  • It is clearly a money grab along with other taxes such as transfer fees (calculated on the sale cost of a vehicle, and not the cost of performing the transfer), and although it is concerning and aggravating, of more issue is the low level at which it is applied. If I wanted a plug-in electric vehicle, that will almost certainly push the price int the taxable level, and Hyundai lists on its website around $70k drive-away for it’s Kona Highlander. So there’s little incentive to for out the extra for such a vehicle. And I concur with Adam – it’s better economy to purchase used but relatively new – than to finance the liefstyles ofour politicians.

  • Having purchased a new VX Landcruiser 18 months ago I was quite astonished at how much went in LCT and stamp duty. However with some cooperation from your dealer you can minimise some of this tax. I had a number of accessories fitted at the dealership prior to pickup, (bulbar, tow pack etc) these were placed on a seperate invoice and used as my deposit on the new vehicle, hence no tax other than GST.

  • Just bought a lc 200 sahara luxury car tax regardless of how much it is or going to be I was always still going to buy it. Of you don’t want to pay it buy cheaper car

  • I was seriously considering upgrading from my LC200 GX to the latest LC200 GXL. That’s not going to happen now. Sorry Melbourne City Toyota, your state government just killed the deal for you!

  • This tax will surely affect aftermarket sellers like ARB & TJM etc. who have just had an expensive ad campaign to get buyers to load up on accessories from the dealer at the point of sale before delivery. I assume this tax will be applied to the final upgraded price before delivery.
    If that is the way it will work, better buy stock and spend the thousands to upgrade later.
    I think this tax may also raise the value of good upgraded secondhand vehicles with new imports rapidly becoming unaffordable , worse with the AU$ diving.

  • Need to look at the ‘Big Picture”. China does not have any cars in the high price range in the Australian market. Any money the Victorian government gets is going to China to pay interest on the loans Dan has taken out with them for infrastructure. You could say its an import duty on non Chinese cars.

  • Well,this is how the gov is paying for their latest cash handout, did you expect that money to come from nowhere? Time to connect the dots folks. On top of this, the fact that the luxury car tax was there to protect a defunct car industry that now is gone is just a monumental ripoff. But just as the GST was supposed to be a “temporary” tax I’m sure the luxury car tax will remain in place for the foreseeable future.

  • I thought the tax Was introduced to protect the local Car industry. Well we no longer have that. Just another hand in our wallets. Have to keep the politicians pockets full. Thieving mob of b……s

  • This article is incorrect and misleading. For starters, there’s no such thing as a “Victorian Luxury Car Tax” – the LCT is a Federal tax, administered by the ATO. Victoria, like other States, levies stamp duty on vehicle transfers and always has, and in this case has adopted the LCT threshold as the threshold for transfer stamp duty. And the increase in stamp duty doesn’t only apply to Toyota Landcruisers, which appears to be what’s being stated.

  • The lct is the primary reason why I haven’t invested ( if you call it that) in a Landcruiser. The reason for the tax is now defunct. Purely a grab, like ‘stamp duty’

  • If that tax applies to landcruisers, in that price range etc, then they would have to apply it to all new trucks with (luxury) items, such as beds, fridges, tv’s, driving lights, bull bars etc, etc. plus all the luxury european & asian & american made vehicles imported to Australia! Wouldn’t it??? or are they just ripping off off-roaders?

  • I must admit to considering a 200 series as the base for a kitted out tourer but having just discovered what Qld is going to slug me in LVT I’ll certainly be looking at downsizing. Also wasn’t the LVT levied to protect Australian Automotive Manufacturing which is now extinct so therefore shouldn’t the LVT suffer the same fate?

  • I know we must pay taxes but please make it fair, justified and when the Gov spends our money please do it wisely so it is not wasted, over the top so you don’t have to find more from us.

  • Don’t we already pay the GST. Wasn’t that supposed to be a fair tax? The more the vehicle costs, the more money in the government coffers. The fact that state governments also take a grab from hard working Australians is ridiculous. In this country if you work hard & take the financial risks you need to further yourself, you get penalized. I guess it really is a penal colony after all.

  • Buy the car and add the extra things to it later may help. This is also a good way to put Toyota out of business and only import small cars.
    We brought an Isuzu NPS 300 6.5 tonne Truck Less comfortable same fuel consumptison.
    Buy a 21.6ft Caravan and see what we pay in road tax even after the 40% reduction NSW, that will be next for many other states chasing money.PS I also so have a Toyota 100series and a Toyota Hi Ace work Van.
    This will also hit the big utes that are being seen more towing van. Question when do you think the government’s will start taxing the cost of power for electric cars ?? remember the cheep auto gas !!!.
    Has any body thought how much power we will need for all the electric vehicles, its all bull DUST.

  • You pay enough for any vehicle no matter if it’s a luxury one or a work vehicle, and you already pay tax on it. Yes it is money grabbing.

  • Its death by a thousand lashes – more and more ways to tax the life (motivation) out of us. Our goals to achieve a bit of luxury are pushed further and further away.

  • It’s all bull crap, oil is obtained at twice the depth of fossils. Is worth nothing but corporations shafting us, government as much as anyone else. Fuel exise & gst. Double taxed. All money grabbing. Wake up people we are being scammed. Oh & diesel costs a few cents a little to produce. Complete ripoff !

  • Another reason to stick with my trusty 100series. As much as a new V8 Cruiser would be nice mine still gets me to where I want to go with money to spend and support to bush towns who really need and earn it.

  • I thought the luxury car tax was instigated years ago to protect the local car industry. We do not have any car manufacturers in Australia anymore so why has this tax not been removed. You are correct in saying that it is just a cash grab by governments.

  • There are stock standard family cars getting close to the LCT threshold …. There is no local car industry anymore to protect so the tax should be scrapped.

  • How can it not be a cash grab? You’ve missed the biggest issue entirely.
    The original sole purpose of the LCT was to protect the Australian car builders from the influx of imports.
    Well, guess what? There’s no Australian car building industry anymore.
    After the last manufacturer closed up the LCT should have been scrapped.
    But no it makes the government money under false pretence.

    • Well said Jason
      This Government got know idea on how to protect any Industry that does employ Victorians for the long term everything they do is solving for the short term grabbing money, I’m not sure if everyone is aware but they tax the fuel pretty darn heavily so the people that buy these vehicles will pay there fair amount of tax in the long run along with the Vehicle getting serviced that employs Victorians that pay tax, the other thing when we see the Government bureaucrats getting out of the luxury cars that will now be taxed even higher that hard working Victorians will pay for at some stage why aren’t they happy getting chauffer driven around in a Mazda 3 like what they are trying to drive people to buy, The Government should live by example

      • Victorians? Don’t you mean Australians, my passport says “Australia” so does yours, don’t separate us, let’s stick together.

  • I’m your average extremely hard working Aussie family man with a small business. We bought a new Sahara 18 months ago with the view that it should last twice as long as anything else on the market. I already give the country 40 cents for every dollar I earn, why should I have to give them any more? I’ve already payed tax on that money I’m using to pay for it!

  • I have no sympathy. People buying these type of vehicles are buying them for status, not real off roaming. Luxuries should be taxed more than essentials if we are to staff our National parks and State Forests.

    • You may not like the Sahara but if you check out Caravan World’s April 2014 “12 Best Caravans” only the Nissan Patrol can tow all of them legally and only 9 of the 12 can be towed legally by the Landcruiser. All of the utes etc cannot tow these vans if loaded to ATM.

      • Rubbish Bob. You obviously havent looked at the LR New Disco. As standard..has excellent carry capacity exceeding 850kg . Excellent GCM @ 2230 & GVM @6670
        FAW 1500, RAW 1775
        Even fully load van at 3500kg n Tug at full GVM (with 350kg BW you still have over 500kg for fuel occupants & cargo)
        Better power to weight ratio 3500kg tow capacity 350 kg ball weight. Better spec in many other ways variable air suspension reverse assist anti sway control, electric brake wire loom included included at manufacture. Better fuel consumption efficiency than your aging Nissan. Sorry Nissan is NOT at the top of the List as the best Tow Tug Vehicle. The LR bets all the other under 5.5m utes. Of course this excludes beasts like Ford 250 etc that craps over even my Disco 5

      • From reading the article the $amount and rates mentioned I think the author is confusing the Vic govt’s existing Stamp Duty with the ATO’s LCT & the new Vic LCT. The fig’s quoted the start point is for the new revised start point for the ATO’s LCT. Vic LCT from what I’ve read kicks in at 100k. The LCT is on top of the ST and on existing taxs. I suppose we do have to pay more for the new 2% pay rise for our polllies who already get paid far more than Canada and England. Even our base MP’s are on well over $200,000 pa
        Just an expensive joke on the rest of us hard working folk.

  • If you can Afford a vehicle of 105,000 to 130,000 Dollars you can also afford the Taxes on that vehicle. These are not standard family cars by any means. Average families can’t afford these types of vehicles period.

  • Pretty sad , like you said , the vehicles with the high tech safety , which do all the r&d , will be taxed through the roof . Disappointing to think that some retirees dreams have been burnt again .

    • Sorry but the cruiser is way behind. Having a Sahara to tow means your not interested in legals for towing. Have looked at all and consider the Colorado and all the other utes better buys. Be realistic they are fuel guzzling vehicles. There are better value vehicles around that the Sahara for towing.

  • “And the vehicle which attracts the most LCT is a Toyota LandCruiser – a popular vehicle for families and landholders. Hardly a luxury vehicle.”

    No offense but a Landcruiser is most definitely a luxury car. Numerous other vehicle can perform the same function, maybe not in the same comfort, at a lower cost.

  • How is it we should still even be paying this tax at all, unless I am mistaken, I seem to recall this tax was introduced to protect our car manufacturing industry, which of course is now gone. Trouble is, Government’s become addicted to the revenue

  • These small increases can easily be paid for by the income tax decreases soon available to people who can afford to buy theses vehicles in the first place! Also, just being a bit picky, Mr Tony Weber citing a Landcruiser Sahara as being the epitome of safety and technology is absolutely laughable.

  • I remember when the LCT and stamp duties etc were first introduced. They were “sold” to us as a way to defend the Australian vehicle manufacturing industry against the rising tide of imported cars. Fast forward to now, there no more vehicles built in Australia so I all these excessive taxes on vehicles should be removed and let the market now decide what the price of a vehicle should be.

  • its a thief tax? wish you hadn’t mentioned luxury boats, planes,caravans,jewellery,clothes and travel some bean counter is itching to justify his job and they are thinking why aren’t these things taxed not that I have many of these things ill be voting with my feet next election

  • It is an arbitrary tax. There is no equivalent on luxury boats, planes, caravans, jewellery, clothes, travel etc. Why should ‘luxury’ car owners incur this tax when similar purchases are luxury tax free.

  • From what I continually see on the news headlines, all state and federal governments are continually pushing us taxpayers to spend more money and keep the economy flowing. If they had any brains they would scrap taxes like this.
    So if they insist on even higher LCT then I’ll just keep the vehicle I’ve got now and drive it into the ground.

    • My thoughts exactly. They won’t get any more cash from me for a new car. Happy to keep driving my 6+ year old Sahara. I also tow a 3 ton caravan. Already paid the taxes.

  • No sympathy to anyone who can throw lots of money at a vehicle, you obviously have lots. lol

    Govts are punch drunk collecting taxes, maybe we need to cull the amount of “chiefs” and direct more money to the real workers.

    Maybe as a sweetner, make vehicles under 1litre and fully electric vehicles under $ 45k ATax free.

    Instead of more Taxes, Govt should have a serious look at waste, eg Road repairs – the quality of repairs is so bad, it suggests incompetent contractors, lack of qualification for whoever is signing off on the jobs, corruption or all three.

    • The lower the tender for road repair. The work is then assigned to that contractor. Cheap payments , cheap work and then more work needed to repair the poor work done in the first place. Along with damages done to motor vehicles by poor road conditions. Councils provide the repair to roads, Governments pay councils for the work. No one is winning.

  • Lets vote for a Australia wide policy, were the people say what all our over paid and money grabbing politicians earn.

  • Great initiative. Those big cars use more resources to be manufactured and burn more petrol than others, contributing more to greenhouse gas emissions.
    I love my 4×4 trips but I rent my car every time.
    Most of those cars are bought to commute to work and carry a single person daily.
    Their owners are more concerned with their own self-esteem and pride than anything else.
    It’s time to grow up, kids, and realise that resources and fossil fuel have to be consumed more scarcely or accept that the more you pollute, the more you are taxed.

  • The luxury car tax was first introduced to protect the Australian automotive industry, why therefore do we even have a LCT when we no longer have an Australian automotive industry. As the article stated it’s purely a money grab.

    • I agree 100% Tim but it will still hit the Heritage/Historic vehicle movement for those wanting to import vehicles over the thresshold! Plus we have an issue with those vehicles due to possible asbestos content, which has to be remove under strict conditions.

  • All you need is one state with the brains to not tax like Vic & Qld do and brokers can buy there and then transfer the reg to your home state

  • So let me get this straight. I go buy a Landcruiser ute or a G300 and it is a luxury car. Has Dan the Man ever ridden in one of these noisy bone-rattling work utes? Danny-Boy these things are built strong have only the basics like motor, transmission, wheels, bloody awful seats and a suspension from the horse and cart days. The only plus with them is if your daily drive includes roads that most city 4×4 drivers think is an “offroad adventure” They keep on keeping on, day in day out.

  • If Toyota are cutting V8 Diesels, won’t that be forcing us to move across to the huge American V8 Diesels? Those US manufacturers don’t seem to be in any hurry to chop them from their range, they just add a turbo V6 to the range and give you an extra option. This just makes the Ford, Chevrolet and Dodge trucks a better option.

  • 31/5/2019 Pat wasn’t the tax put there in the first place to protect the Australian car industry, as I understand it we don’t have a car industry to protect if that is correct the tax VIC and QLD are putting on is nothing but a money grab . Allan

    • I was thinking the exact same thing Allan…. Bit like stamp duty on houses sold when the GST came in many years ago I believe….. 🙁

  • “when you start to add accessories – bull bar, snorkel, suspension, wheels/tyres, lights and roof cages – your total package can quickly breach the threshold.”
    Why would you add these into the initial purchase?? Afterwards and no stamp duty.

  • Reminiscent of the days when Land Barons taxed their subjects into poverty and squalor because they wanted more cash to splash. Eventually the peasants will rise up and toss these fools out of power and into the History books where they will be least remembered. (sad part is an incoming Liberal Govt would leave it there because its income and they can always blame the previous Gov’t). 😢

  • Good Morning, I found I was illegal with my caravan attached to my dual cab so I was forced to upgrade to a 200 series. The Sahara was the only model with the latest safety features. When you add up all Government charges it’s enough to buy a new corolla.

  • This tax was originally brought in because we manufactured cars in Australia, which we no longer do. This tax should be scraped altogether!!!

  • Australia’s cars are expensive enough as it is. Surely we have more than enough taxes between customs, import taxes and gst. We should be getting a reduction rather than an increase. Do primary producers get an exemption???

  • Sounds like a good way to force people into cheap Chinese cars. Another way to send our money to China

    Is there any government in this country that sees the people as first priority and not as milking cows?

  • Wasn’t the LCT first introduced to inject money into the Australian car manufacturing industry? So now that we don’t have a car manufacturing industry, surely this is just free money for the sake of an extra tax for our greedy government?

  • Did I miss the memo? The luxury car tax was imposed to “apparently” protect the Australian car manufacturing industry ….which no longer exists! Why do these buffoons keep raising taxes to protect their utter incompetence and wastage of government money funded by the poor mug taxpayer only trying to get ahead. 😡😡😡

  • The way around this Tax is to go to a different State to buy a new car, when we got the GST all other taxers were to end what a joke.

    • You will probably will need to register the car in the low tax state for a while & then transfer it to Vic as this take is taken when first registered. Dont know if they will try & take it on cars transferring to Vic. A lot of messing around.
      we may start to see a lot of dealer demo’s fr4om interstate being sold in Vic.

  • I am the owner of a well used and loved LC 200 but at this news I certainly will not spend over $65,000 on a replacement vehicle.

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