Tim O'Brien | Sep 4, 2008

STOP PRESS: The Rudd Government’s proposed increase to the luxury car tax, from 25 percent to 33 percent on vehicles worth more than $57,180, has been brought to a screaming halt in the Senate. Family First Senator, Steve Fielding, cast his lot with the opposition, defeating the legislation at the second reading, 34 votes to 33.

The Bill will now be sent back to the House of Representatives for another round of name-calling, biting, scratching, pointing and haranguing – we haven’t seen rolling around on the floor yet – all of which passes as ‘sensible debate’ in that particular ward of the looney bin on the hill there.

Those of you who may be thinking that this will be the end of the matter will be sorely disappointed: this is only a ‘first lap’ failure for the Bill. What will happen now will be a bit of fiddling at the edges of the original Bill, and a renewed round of negotiating. ‘Negotiating’ in the Westminster System, of course, means the process of establishing the price at which those who oppose the Government’s wishes can be bought. (It has given us some truly breathtaking cock-eyed schemes in the past.)

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Then the Bill will be sent back to the Senate for another shot. You can put your grandma on that one Leroy. There is no way that Treasurer Wayne Swan will let the $555million the increase in the Tax was estimated to raise slip from his grasp easily.

But is the tax sensible? Well, no. (But that has never deterred our elected representatives before.)

As Victorian motor body VACC has pointed out, other so-called “luxury items” are not taxed in this discriminatory way. Plasma screen TVs… no; jet-skis… no; trips to France… no… so why single out cars? Why indeed when the industry is so clearly feeling the pinch? And why slug the only sector of Australian vehicle manufacture that is actually growing sales: upper-end local models like the Statesman, G6E Turbo, and optioned-up Calais?

So, a win for good sense for now. Further rounds of stupidity to follow.