Luxury ute tax loophole costs Australians $250m a year, researchers say

[Franco Cozzo]

Uh oh, they're onto the loophole:

Luxury ute tax loophole costs Australians $250m a year, researchers say

The Australia Institute says tax exemption on ‘commercial vehicles’ with no testing requirement is incentivising people to buy utes instead of EVs

A loophole in Australia’s tax law is in effect subsidising the price of luxury utes such as Ram and Chevrolet SUVs, costing taxpayers more than $250m a year in forgone revenue, an analysis has found.

However, the LCT does not apply if a car is “a commercial vehicle designed mainly for carrying goods and not passengers”. This is defined as a car that can carry twice the weight in payload than it can carry in people – a requirement which almost every dual-cab ute on the market in 2024 can meet, according to the Australia Institute.

The Australia Institute concluded the LCT exemption loophole for utes should be ended because it acts as an incentive to buy vehicles that are worse for the environment. They also raised its cost to national tax revenues; the LCT was estimated to raise $1.3b in 2023-24, slightly more than the commonwealth spends each year on the ABC.

The Institute analysed tax and sales data and found that most of the cost of the exemption was related to the largest, most expensive utes, including those from US brands Ram and Chevrolet.

https://www.theguardian.com/australi...-evs-taxpayers

They're hitting all the 'key words' - loophole, revenue, incentive, environment