REMOVING LUXURY CAR TAX ON RE-IMPORTED CARS FOLLOWING REFURBISHMENT OVERSEAS

The Government will remove luxury car tax on cars re-imported into Australia, following a refurbishment overseas, from 1 January 2019.
Currently, cars that are refurbished in Australia are not subject to luxury car tax. However, cars exported from Australia to be refurbished overseas and then re-imported are subject to the tax where the value of the car exceeds the relevant luxury car tax threshold. The Government will remove the inconsistency in tax treatment of refurbished cars in order to align with Australia’s trade obligations with its foreign trading partners. This measure will ensure the same tax treatment applies, regardless of where the car is refurbished.
This measure is estimated to have a negligible cost to revenue over the forward estimates period.