A grey area
THE federal government was congratulating itself this week after re-announcing a plan to allow private buyers to import new cars. This will not deliver cheaper cars for the masses, despite the government’s claim.
The only people with a chance to benefit from this scheme are the super-rich, because the savings only make sense on vehicles costing $200,000-plus.
Independent comparisons by Carsguide show the cost of Australia’s most popular cars such as the Toyota Corolla and Mazda3 — both of which start at about $22,000 and are the same price they were in Australia 20 years ago — are on par with the US and cheaper than Europe once taxes, currency exchange rates and differences in standard equipment are calculated.
But a significant price gap emerges on vehicles above Australia’s $63,184 Luxury Car Tax threshold, which adds 33 per cent to the cost of vehicles above this amount.
Private importing would permit buyers to bring in only one car every two years.
This scarcely guards against damaged and repaired vehicles heading here. I’m sure British dealers are rubbing their hands at the prospect of offloading unwanted models.
These eventually will become used cars. Does the government expect used car buyers to log on to an obscure website to check whether the prospective purchase was a private import?
What about the jobs at the 4000 dealerships in Australia? Will dealers continue to invest in premises and new staff when they have an uncertain future?
If the government wants to make cars cheaper for rich buyers, why not just ditch the LCT? This could be done with the stroke of a pen but would result in a $500 million-plus budget hole to fill each year.
Toyota Corolla: Private import won’t be cheaper than its $22K