Stamp duty changes causing confusion

Automotive lobby groups are already in full PR strike mode, but the Victorian government shows no sign of backing down from its plan to change the way stamp duty is charged for the sale of motor vehicles during the next financial year.

Following a PR tongue-lashing from the FCAI and a couple of naked threats from the AADA, the VACC has made public the results from dealers surveyed through the Chamber's Victorian Automobile Dealers Association (VADA).

The survey reveals that many dealers "have now taken drastic business decisions to stop acquiring stock of high value" and conversations between dealers and customers "have not gone well". These are customers who have contracted to buy a vehicle this financial year, but won't be taking delivery of the new car until after July 1, when the new stamp duty protocol kicks in.

The VACC (Victorian Automobile Chamber of Commerce) has arranged a meeting with Victorian treasurer Tim Pallas for Tuesday of next week. Select prestige dealers will be attending also, to extract a promise from the treasurer that the government will not "go back to the well on dealers again next year," in the words of a spokesman for the VACC.

"We're going to have one last-ditch effort with [the government] on Tuesday [and] actually bring in a couple of genuine dealers that are going to be kissed goodbye, because the consumer won't pay the duty – and the dealer can't afford to pay the duty," he told carsales exclusively.

The government's decision was made despite the VACC asking around the time of the New South Wales state election for "an iron-clad guarantee" that the Andrews Government wouldn't bring in changes to the stamp duty – which Labor in Queensland has previously done.

"They went quiet on us..." the spokesman said.

The VACC believes the change to stamp duty is a fait accompli and the Victorian government won't back-track now. And the government has been quite clear with the VACC that it won't agree to dispensation for buyers who contracted to purchase a luxury before the budget announcement on May 27.

"That has been rejected," the spokesman revealed.

If the AADA holds true to its word and takes the matter before the High Court, it promises to be a long, protracted battle – not least of all because the convoluted plan takes some explaining before it can even be debated.

Unfortunately it's difficult to establish exactly how much extra buyers will be paying in stamp duty. An online calculator maintained by the Victorian registration authority, VicRoads has been providing incorrect stamp duty charges, but VicRoads is working on a fix for that problem.

The Victorian State Revenue Office also maintains an online stamp duty calculator, which apparently does provide accurate stamp duty charges, although it doesn't appear to have been updated for the post-July changes to the stamp duty calculation regime.

For further information concerning the Victorian stamp duty changes for the 2019/20 financial year, read our advice feature.