$200mill package to Ford, Holden, Toyota to offset FBT changes

[bigwil]

Originally Posted by Road_Warrior

I'd suggest to you that the bulk of the money has been invested and for the reasons I outlined earlier, they're more or less compelled to release the car. It is probably why they've decided to reveal it next week.

Is it confirmed for a reveal next week, I hope so but really doubt it.

[Bossxr8]

Originally Posted by Road_Warrior

I'd suggest to you that the bulk of the money has been invested and for the reasons I outlined earlier, they're more or less compelled to release the car. It is probably why they've decided to reveal it next week.

Is that official or just speculation?

[Buntz]

Originally Posted by Outbackjack

And to balance the books the government has resorted to theft??

http://www.news.com.au/money/cost-of...-1226690750065

And that would be better than the bank keeping it?

[Road_Warrior]

Originally Posted by Bossxr8

Is that official or just speculation?

I was referring to the Carpoint article. So yeah speculation I guess

EDIT: Oh

http://news.drive.com.au/drive/motor...806-2rd8s.html

[mr smith]

Originally Posted by karj

II'm not saying that FBT changes won't affect Falcon sales in the coming months, but it is a highly dubious claim that "FBT changes hit Falcon sales hard" in July.

Massive hit. Every lease company I know of have stopped leases and they were stopped immediately.
All Ford employee lease cars were stopped even if the car was ready for pick up.

[zilo]

Originally Posted by mr smith

Massive hit. Every lease company I know of have stopped leases and they were stopped immediately.
All Ford employee lease cars were stopped even if the car was ready for pick up.

How many lease companies is that? 1? 2?
How many Ford employees are we talking about? 2-3-4-5?

[vztrt]

Originally Posted by zilo

How many lease companies is that? 1? 2?
How many Ford employees are we talking about? 2-3-4-5?

About 10% of the builds. If your salary level entitles you to a 'company car' then you get a new one every 3 months.....two cars if your high enough. But its from the entire Ford range (unless its been put on restriction).

[WPR1]

The FBT changes are a big change with no consultation with the industry. And it is a false saving as it is based on receiving extra tax revenue from people continuing to salary sacrifice cars which won't occur now as there is no benefit to do so!

According to news articles it is going to effect over 300,000 workers in this industry.

Another knee jerk response from a hopeless government. I thought the 'new' Kevin had learnt from his mistakes and was a changed man.

[bobthebilda]

The FBT changes are a big change with no consultation with the industry. And it is a false saving as it is based on receiving extra tax revenue from people continuing to salary sacrifice cars which won't occur now as there is no benefit to do so!

Fringe Benefits tax is only payable by those who receive a fringe benefit. The reason people want to receive a fringe beneift, is that it is generally cheaper for them (ie reduces the tax component). No one is going to go out and seek a fringe benefit with the express desire of it costing them more. Any less revenue the government receives from the FBT, will be offset by the fact that people will now being paying more personal tax.


It may cost some people their jobs, but its a job that has been created as a result of a tax concession (which is not sustainable, as someone has to pay for it in the future).

[jimmyxr6t04]

Originally Posted by bobthebilda

Fringe Benefits tax is only payable by those who receive a fringe benefit. The reason people want to receive a fringe beneift, is that it is generally cheaper for them (ie reduces the tax component). No one is going to go out and seek a fringe benefit with the express desire of it costing them more. Any less revenue the government receives from the FBT, will be offset by the fact that people will now being paying more personal tax.


It may cost some people their jobs, but its a job that has been created as a result of a tax concession (which is not sustainable, as someone has to pay for it in the future).

Not entirely true... The figures for my lease didn't really 'add' up to saving me on tax. But the ease of the novated lease still made it worth while for me. I saved 5k income tax from the lease, but had a 10k FBT contribution... It still worked out a little bit better off than opting for a normal loan though.

Eg: a loan of 35k on my turbo territory was $350 per fortnight. Fuel was $200, so that's $550 out of my net pay. My lease i lose about $700 net, but i get a $53k series II Caprice V8, with all running costs included in that...

On that though, i pay a residual of about 30k inc GST... So, i saved about 5k GST up front, but pay the GST on the residual...

Edit: As for me now having to pay more personal tax, i'll simply put that $700 per fortnight into another investment property, which will save me more than 5k tax...

[PepeLePew]

Originally Posted by bobthebilda

Fringe Benefits tax is only payable by those who receive a fringe benefit. The reason people want to receive a fringe beneift, is that it is generally cheaper for them (ie reduces the tax component). No one is going to go out and seek a fringe benefit with the express desire of it costing them more. Any less revenue the government receives from the FBT, will be offset by the fact that people will now being paying more personal tax.


It may cost some people their jobs, but its a job that has been created as a result of a tax concession (which is not sustainable, as someone has to pay for it in the future).

Well summed, and few would question the need for reform, it is the execution which is debatable.

It interests me that this is a reasonably common fringe benefit for mid-range income earners. As has been stated higher income earners have a multitude of ways to reduce tax. To many lower income earners this never represented any form of value. Perhaps a slower implementation giving the 'fat cat' lease companies time to transition their business and/or employees from this 'rort' so jobs weren't just lost overnight may have made more sense. (a level of sarcasm in the use of the quoted terms, they're emotive and commonly used by politicians to rile the masses). Time for consultation to build in factors to support Australia built vehicles without 200M handouts. Perhaps...perhaps...

But in the end it'll be interesting to see if this ever actually becomes law in it's current form, which is doubtful. But they've said it, it's in peoples minds tied to the dreaded word 'carbon' and 'emissions' that everyone seems to think is a satanic ritual in disguise, and the books seem to balance a little in the public mind of those who choose not to look at the bigger picture and flow on effects.

We may look back soon and question why we spun our wheels so hard on this topic IF the transition in FBT is repealed and PLANNED by whoever takes the big seat in September.

One thing is for sure, Australians now uniformly know the words 'novated lease'.

[Road_Warrior]

http://www.caradvice.com.au/245213/f...-falcon-sales/

Phipps confirmed Ford was also engaged in “very early discussions” with the government about its slice of the $200 million support package promised to Australia’s three car makers yesterday by industry minister Kim Carr.

Why bother when they're not going to be making any follow on models here in 2 years??

[vztrt]

Originally Posted by Road_Warrior

http://www.caradvice.com.au/245213/f...-falcon-sales/



Why bother when they're not going to be making any follow on models here in 2 years??

Cause they need volume.

[WPR1]

Originally Posted by bobthebilda

Fringe Benefits tax is only payable by those who receive a fringe benefit. The reason people want to receive a fringe beneift, is that it is generally cheaper for them (ie reduces the tax component). No one is going to go out and seek a fringe benefit with the express desire of it costing them more. Any less revenue the government receives from the FBT, will be offset by the fact that people will now being paying more personal tax.


It may cost some people their jobs, but its a job that has been created as a result of a tax concession (which is not sustainable, as someone has to pay for it in the future).

I think you also need to look at the bigger picture and what is termed the multiplier effect in economic.

A small additional tax bill for the person now not attracted to salary sacrifice a car will cause as report over 300,000 job losses in this industry (tax revenue once collected now unemployment payments); fewer cars sold as their isn't the incentive to turn them over as often (which will cause lay-offs right through the car industry; less GST collected from the purchase of the car; less registration taxes collect etc, etc).

As I mentioned these changes have a multiplier effect in the economy. The people who benefited by salary sacrificing don't have that money to spend elsewhere, the people layed-off don't have the money to spend elsewhere thus the multiplier effect of those dollars is lost to the economy.

It is often said tax less and you will get more as people will have more incentive to spend and this money is then multiplied through many transaction in economy!

[zilo]

It's just a tax minimisation scheme that's had a loophole tightened.

Doesn't matter who wins the next election it's recession time on the horizon me thinks.

Naïve to assume that Rudd or Abbott have any control over what is happening.

[Bossxr8]

Originally Posted by vztrt

Cause they need volume.

How is extra government cash going to bring in those extra buyers to get volume up. No amount of government money is going to bring buyers back to a car they don't want.

What would Ford even do with the money, they don't want to advertise or lift a finger to help Falcon sales.

[mr smith]

Originally Posted by zilo

It's just a tax minimisation scheme that's had a loophole tightened.

Doesn't matter who wins the next election it's recession time on the horizon me thinks.

Naïve to assume that Rudd or Abbott have any control over what is happening.

A tax minimisation that came at the wrong time. The laugh is that there will be no tax gain from this change, if they think that current lease holders will be paying more for their lease cars they will be (as usual) wrong. Having a lease car is an option which if it doesn't add up is easily opted out of.
Just another class warfare measure from clowns who don't value hard workers and want to reward the duds of our country.

[jpblue1000]

Originally Posted by Bossxr8

What would Ford even do with the money, they don't want to advertise or lift a finger to help Falcon sales.

Last time I checked Ford was more than Falcon. a whole range of model sales might benefit from the cash injection

JP

[zilo]

Originally Posted by mr smith

A tax minimisation that came at the wrong time. The laugh is that there will be no tax gain from this change, if they think that current lease holders will be paying more for their lease cars they will be (as usual) wrong. Having a lease car is an option which if it doesn't add up is easily opted out of.
Just another class warfare measure from clowns who don't value hard workers and want to reward the duds of our country.

No it will work just fine.

Those who have been getting a tax deduction will now pay more tax cause they can't reduce their notional remuneration.

The hardest workers are those on awards, not those on staff packages.

Good on you Rudd for closing another tax dodge.

As usual the ones who have been getting away with it will say it wasn't enough notice...too fast....I say tough luck.

The minimisers can thank god it's not retrospective like other avoidance schemes in the past have been.

[Bossxr8]

I don't know wether it's been officially announced or not but heard Bill Shorten say at our union conference today that the government will be offering a 3k rebate on Australian made vehicle's that are novate leased.

About time the government actually did something to reward buyers of Australian made vehicles, just now needs to be expanded into non-lease vehicles, give buyers an incentive to buy locally made.

[jimmyxr6t04]

Originally Posted by zilo

No it will work just fine.

Those who have been getting a tax deduction will now pay more tax cause they can't reduce their notional remuneration.

The hardest workers are those on awards, not those on staff packages.

Good on you Rudd for closing another tax dodge.

As usual the ones who have been getting away with it will say it wasn't enough notice...too fast....I say tough luck.

The minimisers can thank god it's not retrospective like other avoidance schemes in the past have been.

Incorrect mate... Those that were getting a tax deduction because of a novated lease could afford to lose some fortnightly salary on a car. Instead, most will now look to other avenues to reduce income tax.

Do you honestly think people will just sit on their hands and whinge about not being able to lease? Leasing gave me a new car, and reduced some income tax. I still paid more than double FBT than i actually saved on income tax.

Instead of $700 per fortnight out of my pay going towards a car, it will now go towards an investment property. A much better tax deduction. I only got a leased car because it was so easy to manage. I'll still buy a new car, but i'll use my cash instead, and negative gear another property. Might have the wife salary package the mortgage instead of another car, save more tax. Might even start up a business on the side, and write more off...

Plenty of ways to minimize tax, and those that earn enough will find those ways. Novated leasing was just convenient, and i was happy to have a car instead of another investment property.

Anyway, the ATO will now get 5k more out of me (until my next investment), but lose 10k in FBT that i paid annually... So, who's really winning here?

[BHDOGS]

So what your saying is the rich will find a way to screw us all anyway

[jimmyxr6t04]

Originally Posted by BHDOGS

So what your saying is the rich will find a way to screw us all anyway

The 'middle' are the ones who get most screwed IMO. I'd consider myself in the middle.

Why shouldn't people look for legitimate ways to reduce tax?

[bobthebilda]

=jimmyxr6t04;4842697]Incorrect mate... Those that were getting a tax deduction because of a novated lease could afford to lose some fortnightly salary on a car. Instead, most will now look to other avenues to reduce income tax.
Do you honestly think people will just sit on their hands and whinge about not being able to lease? Leasing gave me a new car, and reduced some income tax. I still paid more than double FBT than i actually saved on income tax.

Instead of $700 per fortnight out of my pay going towards a car, it will now go towards an investment property. A much better tax deduction. I only got a leased car because it was so easy to manage. I'll still buy a new car, but i'll use my cash instead, and negative gear another property.

Maaate, did your mum not tell you, that certain acts will make you go blind. Taking out a novated lease is not an investment, buying an investment property is. A novated lease will be for a $40,000 item, an investment property is a $400,000 plus item. People tend to get cars for the purpose of driving them around, you dont see many people driving an investment property around. Plain and simple, if someone is going to get an investment property, it has nothing to do with the fact that they couldnt get a car.

Might have the wife salary package the mortgage instead of another car, save more tax. Might even start up a business on the side, and write more off...
Plenty of ways to minimize tax, and those that earn enough will find those ways. Novated leasing was just convenient, and i was happy to have a car instead of another investment property.
Anyway, the ATO will now get 5k more out of me (until my next investment), but lose 10k in FBT that i paid annually... So, who's really winning here?

Your lease is currently $350 per week, but by stopping this, you will pay $96 a week extra in tax. By my calculations, you are earning high $40 thousand per year. Good luck buying that investment property.

[PepeLePew]

Originally Posted by Bossxr8

I don't know wether it's been officially announced or not but heard Bill Shorten say at our union conference today that the government will be offering a 3k rebate on Australian made vehicle's that are novate leased.

About time the government actually did something to reward buyers of Australian made vehicles, just now needs to be expanded into non-lease vehicles, give buyers an incentive to buy locally made.

The issue with that being there will be bugger all take up of novated leases if the 20% statutory is axed. Those currently on such a lease with high personal use will not renew or engage in a lease in a fit given the lack of benefit. Have a play with the Orix calculator for a bit of fun, you can now plug in your personal use percentage and scare yourself silly

[MITCHAY]

Originally Posted by jimmyxr6t04

The 'middle' are the ones who get most screwed IMO. I'd consider myself in the middle.

Why shouldn't people look for legitimate ways to reduce tax?

Didn't you know it's up to some people to subsidize others livings who pay little or no tax by paying more tax.

And the people who pay more tax shouldn't expect any benefit or be able to minimize their liability at all because that's unfair

[jimmyxr6t04]

Originally Posted by bobthebilda

Maaate, did your mum not tell you, that certain acts will make you go blind. Taking out a novated lease is not an investment, buying an investment property is. A novated lease will be for a $40,000 item, an investment property is a $400,000 plus item. People tend to get cars for the purpose of driving them around, you dont see many people driving an investment property around. Plain and simple, if someone is going to get an investment property, it has nothing to do with the fact that they couldnt get a car.




Your lease is currently $350 per week, but by stopping this, you will pay $96 a week extra in tax. By my calculations, you are earning high $40 thousand per year. Good luck buying that investment property.

Huh? I never said that a novated lease was an investment.. I'm at a stage in my life where i already have 1 investment property, 1 primary place of residence and another property that i own outright. I'm young so took the option to lease a car instead of buying another property. Now, because i don't have the option to package a car, i will get another investment as i will have a greater proportion of disposable income...

High 40k per year? I PAYG'd 34k tax last financial year, so i don't know where your figures have come from.

And yes, i will pay about an extra $100 per week in tax... But i'll also pocket a lot more money by not paying nearly $200 per week FBT and financing a car.

The point is, the 5k tax i saved was such a small insignificant amount compared to the overall picture. Especially if i buy another property that will save me a lot more than 5k tax, and (hopefully) grow in capital to earn me more money...

[jimmyxr6t04]

Originally Posted by MITCHAY

Didn't you know it's up to some people to subsidize others livings who pay little or no tax by paying more tax.

And the people who pay more tax shouldn't expect any benefit or be able to minimize their liability at all because that's unfair

Looks that way mate... I don't mind paying my taxes, but at the same time i don't want to bend over and cop it all so sweet, especially if i can use a few legit methods to reduce my taxable income...

[mr smith]

Originally Posted by zilo

No it will work just fine.

Those who have been getting a tax deduction will now pay more tax cause they can't reduce their notional remuneration.

The hardest workers are those on awards, not those on staff packages.

Good on you Rudd for closing another tax dodge.

As usual the ones who have been getting away with it will say it wasn't enough notice...too fast....I say tough luck.

The minimisers can thank god it's not retrospective like other avoidance schemes in the past have been.

Yup sure.

[2011G6E]

I would guess maybe fifty percent of the depot out here...possibly more...have lease cars. Cars, not utes, not trucks, not work vehicles, but family cars.

And nearly every one of them is now worried as hell about what is going to happen...they all were used to getting a brand new family car every couple of years through salary sacrifice, but now they mostly won't. A lot of guys even get second lease cars, usually smaller ones, for their wives or kids. All that business is now crapped all over by a government trying to drive a typically-Labor class-driven propaganda campaign.

These people aren't rich fat cats, they aren't executives with Mercedes Benzes and BMW's...they're ordinary working people. 70% of the people who took advantage of leasing made less than $100,000 a year, but that's not how Labor has portrayed it, using ridiculous statements about "wealthy fat cats" and similar rubbish.


More big handouts to the motor industry? Hey Rudd...how's that big savings you think you're going to make out of crapping all over lease vehicles going now...?

And as for statements about it being a deliberate tax rort...what a load of rubbish. You're just playing into Labors hands and believing the drivel they are dishing out.
Why can't the working man get some advantages out of the tax system? It's easy enough for "the big boys" to minimise their tax and no one bats an eyelid...but let the ordinary wage slave maybe get a little advantage, and the world comes to an end. How exactly is Joe Average getting a lease vehicle and reducing his taxes a little going to impact anyone else? No one has bothered about it before.

I would hope they close all the other loopholes then...do away with family benefits, why should other taxpayers subsidise your damn kids? Do away with that stupid $18,000 tax free threshold...why should other taxpayers make up the difference for people on low incomes? How about doing away with tax returns all together? I mean, you don't get much back (I paid $36,000 tax past year and got $400 back), so why not just let people pay their taxes and be damn happy with it...why should they expect any personal advatnage out of the system!
Do away with negative gearing and other tax breaks people buying investment properties get too...landlords won't mind...they're all in as a charitable thing aren't they?

Oh...and how about getting rid of all those government cars too...doesn't Rudd have his own damn car he could use to get around in?