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Taxing private use of employer-provided motor vehicles



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MEDIA RELEASE SENATOR FRED CHANEY LEADER OF THE OPPOSITION IN THE SENATE SHADOW MINISTER FOR INDUSTRY, TECHNOLOGY AND COMMERCE

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The Government made its decisions on taxing private use of employer-provided motor vehicles without any detailed assessment of the effect of the new tax on the motor vehicle

industry.

Senator Button admitted in the Senate today that he thought estimates were done at the time of the original White Paper, but apparently no detailed work was done on the impact of the proposal ultimately adopted.

It is extraordinary that such a far-reaching decision was taken in the absence of reliable information about its effects.

The Australian Automotive Dealers Association has forecast that fleet sales could be halved in the first year of the new arrangement, sales permanently reduced by 50,000 cars a year and 12,000 jobs lost.

Senator Button today would not even hazard a guess as to the impact of the fringe benefits tax on vehicle production or sales.

It is clear, that need for extra revenue was the main motivation behind the government's new taxation measures. Having been forced by the unions to drop its indirect tax proposals, the government was desperate to get its hands on whatever money it could.

It is one thing for a government to raise money by increasing taxes or doing away with concessions. But to do so without proper regard for the consequences on particular sections of the economy is short-sighted and foolhardy.

Workers in the car industry and in vehicle sales and servicing whose jobs may be lost as a result of the fringe benefit proposals will- be disappointed that this government made the - decisions it did without any real study of their likely

impact. .

Canberra 9 October 1985 Contact : Keith Kessell 72 6380