Footnotes

Chapter 1 - Introduction

[1]        A New Tax System (Luxury Car Tax Imposition   General) Amendment Bill 2008, A New Tax System (Luxury Car Tax Imposition  Customs) Amendment Bill 2008 and A New Tax System (Luxury Car Tax Imposition  Excise) Amendment Bill 2008.

[2]        Exempt vehicles include emergency vehicles and vehicles specifically fitted out for transporting disabled people seated in wheelchairs.

[3]        The three Australian vehicle manufacturer/distributors (Ford, Holden and Toyota) appeared as witnesses, as did leading importer/distributors Audi, Mercedes and Toyota. The Federal Chamber of Automotive Industries, the Australian Automobile Association, the Victorian Automobile Chamber of Commerce and the Motor Trades Association of Queensland appeared in their own right, while the Motor Trades Association of Australia was represented by its South Australian, New South Wales and Queensland branches.

[4]        A New Tax System (Luxury Car Tax Imposition General) Act 1999, A New Tax System (Luxury Car Tax Imposition Customs) Act 1999 and A New Tax System (Luxury Car Tax Imposition  Excise) Act 1999.

[5]        The Car Depreciation Limit introduced in 1979 was adopted as the threshold for both the wholesale sales tax and the Luxury car tax.

[6]        VFACTS sales figures for Passenger vehicles and SUVs sold in Australia in 2007.

[7]        Claims, such as by Mr John Chapman, Motor Trades Association of South Australia, Proof Committee Hansard, 22 July 2008, p. 16; and Australian Automobile Dealers Association, Submission 13, p. 1; that LCT is 'a tax on a tax' are misplaced.

 

Chapter 2 - Key issues

[1]        Information provided by FCAI.

[2]        Accordingly, fleet sales are disregarded and luxury cars have a small weight in the basket.

[3]        Quality adjustments are applied in principle to all components of the CPI but are in practice more important for items such as cars and consumer electronics than for basic foodstuffs or clothing.

[4]        ABS, Australian Consumer Price Index: Concepts, Sources and Methods, 2005.

[5]        Based on FCAI figures supplied in Submission 8b.

[6]        FCAI, Submission 8b, p.4

[7]        Assuming no change in demand from 2007 sales figures.

[8]        Information provided by FCAI.

[9]        Mr Russell Scoular, Ford Australia, Proof Committee Hansard, 6 August 2008, p. 8.

[10]      ABS Cat. no. 6430.0 gives the weight of motor vehicles in the CPI as 4.9% as at June 2005. The proportion of cars affected is discussed in paragraph 1.10. Figures on revenue and volume of sales by price were provided by FCAI. A more sophisticated estimate would be likely to be even smaller. Some of the tax increase will be absorbed by manufacturers or dealers rather than passed on to consumers, and there will be a modest deflationary impact as car buyers have less money to spend on other goods and services.

[11]      Mr Joerg Hofmann, Audi Australia, Proof Committee Hansard, 31 July 2008, p.

[12]      Mr Andrew McKellar, Federal Chamber of Automotive Industries, Proof Committee Hansard, 22 July 2008, p. 10.

[13]      Mr Joerg Hofmann, Audi Australia, Proof Committee Hansard, 31 July 2008, p. 2.

[14]      Porsche Australia, Submission 5, p. 2.

[15]      Ms Vesna Katic, Toyota Australia, Proof Committee Hansard, 6 August 2008, p. 5.

[16]      Mr David McCarthy, Mercedes-Benz Australia, Proof Committee Hansard, 6 August 2008, p. 22.

[17]      Explanatory Memorandum, p.1

[18]      A point made by Mr David Purchase, Victorian Automobile Chamber of Commerce, Proof Committee Hansard, 6 August 2008, p. 15.

[19]      Mr Andrew McKellar, Federal Chamber of Automotive Industries, Proof Committee Hansard, 22 July 2008, p. 2. A similar point was made by Mr Mark Coulton MP, Submission 17.

[20]      For example, Mr John Chapman, Motor Trade Association of South Australia, Proof Committee Hansard, 22 July 2008, p. 16; Mr David Purchase, Victorian Automobile Chamber of Commerce, Proof Committee Hansard, 6 August 2008, p. 14; and Mr McCarthy, Mercedes‑Benz Australia, Proof Committee Hansard, 6 August 2008, p. 22.

[21]      Mr Joerg Hofmann, Audi Australia, Proof Committee Hansard, 31 July 2008, p. 3. Ms Vesna Katic from Toyota reported the Philippines has a luxury car tax; Proof Committee Hansard, 6 August 2008, p. 5.

[22]      Treasury [Henry Review], Architecture of Australia's Tax and Transfer System, p.281.

[23]      For example, Mr Peter Griffin, Toyota Australia, Proof Committee Hansard, 6 August 2008, p. 2.

[24]      VACC, Submission 11, attachment C; European Commission's submission to Bracks review.

[25]      Examples include airbags, anti-lock brakes and stability control.

[26]      Mr Tim Reardon, Federal Chamber of Automotive Industries, Proof Committee Hansard,  22 July 2008, p.2.

[27]      This point was made in general by Mr Tim Reardon, Federal Chamber of Automotive Industries, Proof Committee Hansard, 22 July 2008, p.5.

[28]      Mr Horst Van Sanden, Mercedes Benz, Proof Committee Hansard, 6 August 2008, p.23

[29]      Mr Peter Griffin, Toyota Australia, Proof Committee Hansard, 6 August 2008, p. 7.

[30]      Toyota Australia, Submission 7, pp 5-6.

[31]      Secretariat calculation based on fuel economy data from Top Gear Australia, July 2008, and median of car models selling more than 100 vehicles in 2008, based on VFACTS sales data.

[32]      Mr John Burt, Sporting Car Club SA, Proof Committee Hansard, 22 July 2008, p. 13; Association of Motoring Clubs, Submission 14.

 

Dissenting Report from Coalition Senators

[1]        Glenn Milne, 'Hit the rich', Sunday Mail, 11 May 2008, p. 1.

[2]        Wayne Swan, “Sunday”, Channel 9, 11 May 2008.

[3]        Senate Economics Committee, Senate Estimates Hansard, 2 June 2008, pp 69-70.

[4]        Federal Chamber of Automotive Industries, Submission 8b , p. 4

[5]        Based on average 2007 selling price of $70,705 pre-LCT.

[6]        Labor Senators’ majority report at 2.19: “the total CPI might have a one-off increase of 0.01 per cent.”

[7]        Review of Australia’s Automotive Industry, Discussion Paper, March 2008, p. 11.

[8]        Review of Australia’s Automotive Industry, Final Report, 22 July 2008, p. 7

[9]        Industry Assistance Commission, Report into the Automotive Industry, 17 December 1990.

[10]      Industry Assistance Commission, Report into the Automotive Industry, 24 June 1981.

[11]      The Hon. Peter Reith, House Hansard, 15 May 1990.

[12]      Industry Assistance Commission, Report into the Automotive Industry, 17 December 1990.

[13]      Productivity Commission, 27 May 1997.

[14]      VACC, Submission 11, p. 4.

[15]      Proof Committee Hansard, 22 July 2008, p. 3.

[16]      As cited in VACC, Submission 11, p. 9.

[17]      http://edition.cnn.com/2007/WORLD/americas/10/15/venezuela.sin.tax/index.html.

[18]      Senator Doug Cameron, Proof Committee Hansard, 6 August 2008, p. 6.

[19]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, pp 2-3

[20]      FCAI, Submission 8a, p. 2.

[21]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, p. 2.

[22]      FCAI, Submission 8b, p. 2. 'Family Six' refers to base model Holden Commodore and Ford Falcon.

[23]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, p. 4.

[24]      Victorian Automobile Chamber of Commerce, Submission 11b, p. 1.

[25]      Mr Russell Scoular, Ford Australia, Proof Committee Hansard, 6 August 2008, p. 10.

[26]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, p. 6.

[27]      Proof Committee Hansard, 6 August 2008, p. 9.

[28]      Mr Russell Scoular, Proof Committee Hansard, 6 August 2008, p. 8.

[29]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, p. 6.

[30]      VACC, Submission 11, attachment C; European Commission's submission to Bracks review.

[31]      First articulated on 16 March 2007 to John Laws and repeated numerous times since.

[32]      Mr Andrew McKellar, Proof Committee Hansard, 22 July 2008, p. 3.

[33]      Mr David Smith, Motor Trades Association of New South Wales, Proof Committee Hansard, 31 July 2008, p. 18.

[34]      Mr David Purchase, Victorian Automobile Chamber of Commerce, Proof Committee Hansard, 6 August 2008, p .19.

[35]      Mr John Chapman, Proof Committee Hansard, 22 July 2008, p. 24.

[36]      Proof Committee Hansard, 31 July 2008, p. 4.

[37]      Senator Doug Cameron, Proof Committee Hansard, 31 July 2008, p. 8.

[38]      Senator Mark Bishop, Proof Committee Hansard, 31 July 2008, p. 19.

[39]      Mr Joerg Hofmann, Audi, Proof Committee Hansard, 31 July 2008, p. 8.

[40]      As cited by Mr Hofmann of Audi, 40 percent of the car fleet are between 11 and 20 years old, Proof Committee Hansard, 31 July 2008, p. 3.

[41]      Review of Australia’s Automotive Industry, Final Report, 22 July 2008, pp 97-8.

[42]      Victorian Automobile Chamber of Commerce, Submission 11, p. 9

[43]      Mr Joerg Hofmann, Proof Committee Hansard, 31 July 2008, p. 4.

[44]      Greenwoods & Freehills, advice to VACC, Submission 11.

[45]      Mr Allan Brink, Audi, Proof Committee Hansard, 31 July 2008, p. 5

[46]      Mr David Russell, VACC, Proof Committee Hansard, 6 August 2008, p. 19.

[47]      Mr Joerg Hofmann, Audi, Proof Committee Hansard, 31 July 2008, p. 9.

[48]      Mr Peter Griffin, Toyota, Proof Committee Hansard, 6 August 2008, p. 4.

[49]      Labor Senators’ majority report at 2.20: “the total CPI might have a one-off increase of 0.01 percent.”