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Toyota reacts to LCT threshold changes

Tax cuts: The LandCruiser Prado Kakadu is one of the 14 Toyota models to benefit from the rise in the luxury car tax threshold.

Higher luxury car tax threshold prompts Toyota to pass on savings

Toyota logo5 Jul 2016


TOYOTA Australia has taken advantage of an increase in the luxury car tax (LCT) threshold to reduce the price of a number of its more expensive models.

The entire LandCruiser 200 series range, four LandCruiser Prado variants, the AWD Kluger Grande and top-spec Tarago Ultima all receive a discount of $284, while the 2WD Kluger Grande no longer qualifies for the LCT, and has therefore been given a $267 price reduction.

LCT is based on a calculation of the difference between the vehicle’s RRP and the LCT threshold. With the rise in the threshold, the difference in the RRP and threshold shortens, resulting in a discount for cars that are still above the line.

During the 2015/16 financial year, the LCT threshold was set at $63,184, but in accordance with inflation, that figure has risen $948 to $64,132 for the new financial year.

Also, the tax threshold for imported fuel-efficient cars that use no more than seven litres of fuel per 100 kilometres has been increased for the first time in six years, up $151 to $75,526.

The LCT is applied to 33 per cent of a vehicle’s recommended retail price above the threshold, and was raised from 25 per cent in 2008.

Toyota Australia executive director sales and marketing Tony Cramb reiterated his belief that the LCT should be abolished in Australia.

“This is an inequitable tax because it applies only to vehicles and not to other high-end goods such as luxury boats, jewellery and watches,” he said.

“It is unfair that such a discriminatory tax hits consumers who are already contributing significantly to government coffers through GST, stamp duty and registration fees when buying a new car, as well as hefty taxes on fuel.

“Last year, more than 13,500 new Toyota owners were hit by this inefficient, punitive and poorly designed measure.”

While there have been repeated calls from within the industry to abolish the LCT, it brings in an estimated $400-500 million in revenue for the federal government each year.

Revised 2016 Toyota pricing*
ModelNew PriceReduction
Kluger 2WD Grande (a)$64,075-$267
Kluger AWD Grande (a)$68,046-$284
Tarago Ultima (a)$67,316-$284
Prado VX Petrol (a)$72,706-$284
Prado VX TD (a)$73,706-$284
Prado Kakadu Petrol (a)$83,206-$284
Prado Kakadu TD (a)$84,206-$284
LandCruiser 200 GX TD (a)$76,216-$284
LandCruiser 200 GXL Petrol (a)$81,716-$284
LandCruiser 200 GXL TD (a)$86,716-$284
LandCruiser 200 VX Petrol (a)$92,216-$284
LandCruiser 200 VX TD (a)$97,216-$284
LandCruiser 200 Sahara TD (a)$118,216-$284
*Excludes on-road costs

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