The car industry has renewed calls for states and territories to standardise motor vehicle stamp duties across Australia – as figures show the cost varies from $360 to $1500 on an identical $35,000 family car.
Stamp duty is a state tax and one of the many charges that is bundled within on-road costs for both new and used cars.
On cars that cost $100,000, the stamp duty can vary from $3400 in one jurisdiction to $7900 in another.
Research conducted by CarAdvice shows each state and territory structures stamp duty differently, penalising motorists in some states while providing others with a significant cost saving. The table can be found at the end of this article.
Most states charge a flat rate on the cost of the vehicle, or a rising rate as the price increases. Some jurisdictions base stamp duty rates on emissions, engine size, or fuel type.
For example, in NSW stamp duty is charged at 3 per cent up to $45,000 and 5 per cent beyond that threshold, plus a nominal $1350.
In Victoria, from 1 July 2020 stamp duty will be calculated at approximately 4.2 per cent for vehicles that cost less than $68,740 ($8.40 for every $200 or part thereof).
From 1 July 2020, for vehicles between $68,741 and $100,000 sold in Victoria, stamp duty is equivalent to approximately 5.2 per cent ($10.40 for every $200 or part thereof).
From $100,001 to $150,000, the stamp duty on vehicles sold in Victoria are calculated at approximately 7 per cent (or $14 for every $200 or part thereof), and cars above $150,000 are calculated at approximately 9 per cent ($18.00 for every $200 of part thereof).
In Victoria, motor vehicle stamp duty is calculated on the entire price of the car, rather than a stepped system that only charges a percentage above each threshold, as is often done in other states. All low emission vehicles in Victoria are charged at the lowest stamp duty amount.
Queensland has a sliding scale approach, from 2 per cent for electric and hybrid vehicles, to 4 per cent for cars with eight cylinders or more.
The ACT also has a sliding scale, but calculates its stamp duty based on CO2 emissions. Vehicles producing less than 130g of CO2 per kilometre are not charged any stamp duty, rising to 6 per cent for cars over $45,000 that produce more than 220g of CO2.
Western Australia charges 2.75 per cent stamp duty for cars that cost less than $25,000, 6.5 per cent on every dollar for cars that cost more than $50,000. For vehicles valued between those two amounts the stamp duty is calculated as: [2.75 per cent + (dutiable value - 25,000)/6,666.66)].
In South Australia, passenger vehicles over $3000 are charged at a flat-rate of 4 per cent over that amount, plus $60. Stamp duty for new motor vehicles excludes the value of dealership accessories.
Tasmania charges a flat 3 per cent for vehicles valued up to $34,999, 11 per cent plus $1050 from $35,000 to $39,999, and a flat 4 per cent above that threshold.
The Northern Territory charges a flat rate of 3 per cent, no matter the value of the car, but many buyers are exempt. If you are transacting with a family member or someone you work with, this is considered a 'non-arm's length transaction' and you pay no stamp duty.
As you can see from the examples shown above, the cost for identical cars varies greatly depending on where they are registered – and the different calculations make it difficult for car companies to offer national drive-away deals, especially on dearer models.
James Voortman, the CEO of the Australian Automotive Dealers Association (AADA) – an organisation representing 3500 showrooms nationwide – told CarAdvice: “The differing rates of stamp duty in the various states and territories is ridiculous, especially at the premium end of the market. It certainly adds to the difficulty of doing businesses.”
Mr Voortman said it has become “a lottery for consumers who are advantaged or disadvantaged simply because of where they reside”.
“There is no reason why the federal, state and territory governments cannot work together to introduce uniformity in these charges,” he said.
The boss of Mercedes-Benz Australia, Horst von Sanden, called stamp duty "a tax, upon a tax, upon a tax".
He says if stamp duty is overhauled, it should be streamlined to encourage safer and more environmentally-friendly cars.
“In many cases, [stamp duty] imposes significant extra taxes on cars fitted with the highest levels of safety, innovation, technology and fuel efficiency measures," said Mr von Sanden.
“Not every vehicle attracting the Luxury Car Tax and the highest rate of state-based stamp duty falls within the category of a luxury car.”
In addition to the stamp duty, new cars are subject to a 5 per cent import tariff (from Europe and UK), 10 per cent GST, and 33 per cent Luxury Car Tax (LCT) on every dollar above $68,740 – or $77,565 for fuel-efficient vehicles.
The Australian Tax Office defines a fuel-efficient vehicle as having an official average fuel consumption rate of less than seven litres per 100 kilometres of driving. Both LCT thresholds listed come into effect on 1 July 2020.
NSW and Victorian governments are currently considering changes to stamp duty as it applies to land, prompting the car industry to renew its campaign for motor vehicle stamp duty reform.
Import tariffs were introduced to help to protect the Australian car manufacturing industry. However, the tax remains, despite the end of local car manufacturing in 2017. LCT replaced Wholesale Sales Tax around the same time GST was brought in.
The Federal Chamber of Automotive Industry (FCAI), the Australian Automobile Association (AAA), and the Australian Automotive Dealer Association (AADA) have all been vocal critics of inequitable stamp duties and the federal Luxury Car Tax.
CarAdvice has previously reported Toyota buyers pay more in LCT than do buyers of most luxury cars.
The table below provides two examples of the differences in stamp duty applied across Australia.
|Mazda CX-5 Maxx AWD||Toyota LandCruiser VX|
|Luxury Car Tax||NA||$10,520|
|NSW Stamp Duty||$1080||$4760|
|VIC Stamp Duty||$1512||$7910|
|QLD Stamp Duty||$1080||$6792|
|SA Stamp Duty||$1380||$4468|
|TAS Stamp Duty||$1160||$4528|
|WA Stamp Duty||$1583||$7352|
|NT Stamp Duty||$1080||$3396|
|ACT Stamp Duty||$360||$5892|
Please note that this table has been produced for demonstration purposes and does not take into account all taxes, fees, charges, and other factors that may be applicable when purchasing a new car. Costs listed are indicative only.
How stamp duty is calculated across Australia
New South Wales
|Vehicle Value||Stamp Duty Rate|
|Under $45,000||3% per $100|
|$45,000+||5% per $100 + $1350|
|Vehicle Classification||CO2 per km||New/Used||Vehicle Value||Stamp Duty Rate|
|Passenger vehicle||Under 120 grams||New or used||Any value||$8.40 per $200|
|Passenger vehicle||120+ grams||New or used||Under $67,525||$8.40 per $200|
|Passenger vehicle||120+ grams||New or used||$67,525 to $100,000||$10.40 per $200|
|Passenger vehicle||120+ grams||New or used||$100,000 to $150,000||$14 per $200|
|Passenger vehicle||120+ grams||New or used||$150,000+||$18 per $200|
|Solos & commercial vehicles||NA||New or used||Any||$8.40 per $200|
|Vehicle Classification||Stamp Duty Rate|
|Hybrid/electric vehicles||2% per $100|
|1-4 cylinders / 2 rotors||3% per $100|
|5-6 cylinders / 3 rotors||3.5% per $100|
|7+ cylinders||4% per $100|
|Classification||Vehicle Value||Stamp Duty Rate|
|Commercial & passenger vehicles||Under $1000||1% per $100|
|Commercial & passenger vehicles||$1000 to $2000||2% per $100 plus $10|
|Commercial||$2000+||3% per $100 plus $30|
|Passenger vehicles||$2000 to $3000||3% per $100 plus $30|
|Passenger vehicles||$3000+||4% per $100 plus $60|
|Vehicle Value||Stamp Duty Rate|
|$600 to $34,999||3%|
|$35,000 to $39,999||11% plus $1050|
|Vehicle Value||Stamp Duty|
|$25,001 to $50,000||2.75% + ((dutiable value - 25,000)/6,666.66)|
|Transaction Classification||Stamp Duty Rate|
Australian Capital Territory
|Classification||CO2 per km||Vehicle Value||Stamp Duty|
|B||131-175||$45,000+||2% plus $450|
|C||176-220||$45,000+||5% plus $1350|
|D||220+||$45,000+||6% plus $1800|