Changes to Luxury Car Tax for 2026 will hit Toyota Kluger, Mazda CX-90, Audi Q5, and Australian family SUV buyers hardest
Amid whispers of a prolonged-awaited Luxury Car Tax (LCT) capitulation, the Australian Executive has modified the definition of ‘gas efficient autos’, with a good deal heightened expectations for financial yr 2025-2026.
Luxury Car Tax applies a 33 percent tax on every dollar over a lisp threshold. Two thresholds are for the time being in station: $91,387 for gas-efficient autos and $80,567 for varied autos. Display that LCT applies earlier than on-avenue expenses.
Financial yr 2025-2026 begins on July 1, and a lot of punters expected a yr-on-yr buffer to be applied to each and every classes of LCT — but this hasn’t happened. FY25-26 will retain the same $91,387 and $80,567 sign ceilings despite tighter restrictions.
As well, contemporary autos will should always meet a mixed gas economy of three.5L/100km to be regarded as ‘gas efficient’ — a huge narrate for family autos such because the Toyota Kluger and Mazda CX-90 D50e, which met the old benchmark of 7L/100km.
As a consequence, many Australian households searching to buy a brand contemporary automobile — particularly those making an are trying in the seven-seat SUV segment — is on the total paying even extra. The table under displays how some standard devices will be affected.
| Discover / Model | Latest sign (earlier than on-avenue expenses plus LCT) | Unique sign (earlier than on-avenue expenses plus LCT) | Tag perform bigger as a consequence of LCT swap |
|---|---|---|---|
| Audi Q5 40 TDI Quattro Sport MHEV | $87,000 | $89,123 | $2,123 |
| Toyota Kluger Grande Hybrid AWD | $84,080 | $85,239 | $1,159 |
| Mazda CX-90 D50e Azami Takumi | $92,101 | $95,907 | $3,806 |
Luxury Car Tax turned into as soon as launched in 1999 in an effort to thwart gross sales of imported autos, in-turn maintaining Australian brands. The 2 native heavyweights, Ford Australia and Fashioned Motors Holden, closed in 2016 and 2017 respectively, yet the LCT serene remains…for now.
A file published in The Australian claims that “a source shut to the Prime Minister” has printed that the Federal Executive is “provocative to dump the [LCT] tax” in trade for “higher receive genuine of entry to for Australia’s agricultural exports”.
As rigidity from European buying and selling companions grows exponentially, an abolishment of LCT looks extra possible now than ever earlier than. Chasing Cars has been investigating updates to the LCT very carefully. Our weird and wonderful file would perchance most certainly even be viewed right here.
Source credit : chasingcars.com.au
