David Blackhall

THE Australian Automotive Dealer Association (AADA) has applauded the federal government’s commitment to returning a surplus of $7.4 billion by 2020-21.

AADA CEO David Blackhall said he regards it as a Budget that demonstrates fiscal responsibility with the fair and reasonable path it is taking to return a surplus.

“What is relevant to the automotive industry is that the Budget provides tax cuts for small business, increases spending on infrastructure projects and the introduction of a $100 million fund for manufacturers to diversify and expand their business now that automotive manufacturing has all but ceased,” he said.

“The positive outcome is that this Budget will create new services, generate employment, provide security and the opportunity for consumers to upgrade their family transport to new, safer, fuel efficient, environmentally friendly reliable vehicles.

“The downside is that consumers will continue to be punished by having to pay the unnecessary Luxury Car Tax (LCT) that by 2020-21 will raise $720 million.

“It can only be regarded as a cash cow for the government that some consumers consider inequitable and taxation by stealth.

“As we have pointed out to senior LNP ministers consistently, this is an anachronistic tax – a hangover from highly doctrinaire policy originally developed by Labor.

“The irony is that in the main, the burden of this tax falls on the average wage and salary earner who purchases or leases a car, often as a tool of trade. It does little to curb sales of supercars and it’s time for it to go,” he said.

By Daniel Cotterill