toban

It seems our government do not like us being able to buy cars over $100,000.00 starting January 1/22. They said," if you are fortunate enough, worked hard enough or are lucky enough to be able to buy a car/ recreation plane valued over $100,000.00 or a boat valued over $250,000, congratulations, as you will be paying us more tax." All amounts over these figures will be subject to a 20% tax. So, if your car is valued at $110,000.00, then you will pay an extra $2000.00.

Business should be pretty good in 2021 with people trying to beat the January 1/22 deadline. Now, this hasn't been passed in parliament yet but it will.

Toban

Philamg

We pay extra tax for 5 years on cars over £40000 in the UK, this includes extras, for example if the car costs £35000 and you put £5001 worth of extras on it you pay the tax.

Professor1234

I absolutely BRISTLED when I heard Freeland quoting that line. Fortunate? Lucky? WTF? I, like many, have worked damn hard to be in a position to buy a car of that value. $100K doesn't go really all that far in the car world these days. I think you can get an F150 nearly to that anymore.

toban

Yes, you are right as I chuckle. A F150 limited is close to $100,000.00. The words, lucky, fortunate got me going too but the one that really turned my crank was ‘congratulations’ you will pay more tax sarcastically.
The dealer is not happy and my general manager said it could have a huge affect on their business.

Toban

Ron.s

I call it “Robin Hood” politics...tax the rich seems to be reasonable politically. That way Government doesn’t need to match spending to income like we all try to do as individuals. Somehow it seems OK to overspend with your hand in someone else’s pocket. We have a big dose of that trending in the US at present.

marchgroupinc

Yes it will pass and won't get much attention. We all knew it was coming since the 2019 election. Wait 10 years when many vehicles will qualify. My guess is no future government will bring it as an election issue to eliminate it.

Further on the politics of vehicles, if we could just motivate politicians to get us a good Lemon Law like some of the best US states have!

toban

So true unfortunately. Nobody really cares.

Toban

TexAg91

Is that a one time sales tax, or is that a yearly personal property tax based on vehicle value? Tax tiers are common practice on income taxes here in the US, but we don’t have a national sales tax. I guess Canada is being “inventive” with a national tiered sale tax?

Professor1234

It’s a one time tax, in addition to our harmonized sales tax which is 13% in my province. Outside of property taxes, which fund municipal and educational services, we don’t have taxes on other assets. Plenty of income tax is paid though, I can tell you that much!!

superswiss

Such a luxury tax is common in many countries. I had to look it up, but even the USA had one. It was enacted in 1991 and signed by Goerge H.W. Bush. The tax was levied on many material goods. It was 10% on cars over $30,000 and boats over $100,000 etc., but it was abolished two years later by Clinton and Congress citing loss in jobs after the luxury yacht industry heavily lobbied against it.

mikapen

Actually the luxury tax was rammed through by the Dem Congress, and Bush worked to repeal it in 1992. https://www.latimes.com/archives/la-...614-story.html

But to put it in context, the average car sold in 1990 was about $13,000, and today it's about $39,000.

petee1997

It’s not a big deal. How many people buy cars for over 100K. I think only one Canadian who posted here owned a car over 100K. The GLS 580. So if you are spending 120K plus HST, what’s an extra 4K. And if it really bothers you, buy a cheaper car.

Professor1234

Well, my fairly well optioned GLE450 is $103K, but I get what you are saying. It bothers me but won’t stop me from buying a car. If you think it’s about the money, you’re missing the point.

toban

It just ticked me off the gov’t is penalizing someone who is able to buy a car at this price. So, being sarcastic about it didn’t help.

Toban

digital_b

if that were true you and others like you would vote them out.

Taddis

Will anything change on taxes under Biden?

toban

This thread was a reference to a luxury tax in Canada. Sounds like Biden’s on a similar thought process in raising taxes in the USA but haven’t heard anything about the kind of luxury tax Canada is going to institute.

Toban

Timmay

I heard the threshold was going down. When I ordered mine this past Feb, it was 125K threshold before jumping to the 20% luxury tax, and just got under it by $400. Now they are lowering the threshold to $100K which is crazy. I missed the announcement but did hear this was coming.

BACnMercedes

I just paid about $1300 property tax on a soon to be lemon buy back 580 so I feel your pain. We have to pay that property tax every year we own the car. It does decrease slightly every year though.

toban

Don’t they call that an asset tax in the USA?

Toban

mikapen

It depends on the State. Here in Colorado, they call it a "specific ownership tax." That's annually, after the Registration Fee.

toban

Does the fee go down each year as the car depreciates or is it fixed from the new cost never mind the year of the car?

Toban

mikapen

In Colorado it does. About $2000 first year- based on a percentage but not actual value. Then declining until it reaches a final value, about eight years I think
Of course that's after the sales tax, which runs about 7% but that's only at time of purchase.
Again, every State is different, Very Different!

Professor1234

Shhhh don't give JT any ideas or he's apt to add one of these taxes to the one at purchase...

Camarieoz

Canada is ALMOST as bad as Australia...A GLE400 D..retails now at $177,000 AUD, which includes Luxury car tax,GST,(goods and services tax) plus stamp duty ..so that's about $45k AUD in taxes all... up!!!
So pay for it with post paid tax dollars ,assume average of 33%...the real cost is about $235k AUD..just taxes upon taxes..