The price of Australians’ favourite SUVs, utes and 4WDs will be jacked up by thousands of dollars under Labor’s proposal for a new tax on the family car.

Industry analysis of Labor’s family car tax predicts the cost of some popular models such as the Toyota Landcruiser could rise by as much as $25,000.

Federal Member for Fairfax, Ted O’Brien said Labor’s newest tax will put too many cars out of reach of the average family’s budget on the Sunshine Coast.  

“During a cost-of-living crisis, the last thing people want to hear is that the Albanese Labor government is going to increase the cost of Australians’ favourite family cars and utes with a great big tax,” the Shadow Minister for Climate Change and Energy, Ted O’Brien said.  

“If you’re a tradie and you’re buying vehicles such as a BT-50 or a D-Max or a HiLux or a Ranger, the Albanese Government’s family car tax is going to drive up the cost by thousands of dollars.”

Principal Director at Ken Mills Toyota in Maroochydore on the Sunshine Coast, Brett Mills said while he understood the need for a fuel efficiency standard, he was concerned the proposal was too aggressive.

“It won’t just add cost to Ute’s, this will affect popular SUV’s and passenger cars that dominate the roads and driveways of the Sunshine Coast, even hybrid variants get dragged in,” Mr Mills said.

“The standard will force product to market which with current technology simply will not fulfill the purposes needed by consumers in many cases.” 

“Consumer sentiment around buying low emission vehicles, the development of low emission propulsion technology and necessary supporting infrastructure all point to the need for more time. More time results in a less damaging execution, reduced affordability, less choice and compromised durability to consumers, this will be the inevitable outcome under such an aggressive proposal”.

Industry experts have warned that Labor’s new family car tax would not only reduce the choice of vehicles available and see some vehicles withdrawn from the market but could penalise manufacturers by up to $38 billion over the next five years.

Queensland’s three favourite vehicles in 2023 were the Toyota Hilux, the Ford Ranger and the Isuzu D-Max which will incur a penalty of $14,490, $17,950 and $13,830 respectively by 2029.

Even the Toyota Rav4 hybrid, Queensland’s fourth favourite vehicle will incur a penalty of $4,460.

It’s not just consumers who will pay, however. This could also threaten thousands of jobs across the State.

Labor’s family car and ute tax will put pressure on over 13,208 direct local jobs across QLD at over 703 statewide dealerships, including 37 in Fairfax.

Dealerships account for $3.9 billion annual economic contribution in QLD including $1.6 billion in wages.

Mr O’Brien also pointed to the disastrous rollout of a similarly aggressive standard in New Zealand.

“In New Zealand, we saw a similar tax drive up the cost of a car by about NZ$7,000,” Mr O’Brien said.

“Helping Australians drive cleaner and more efficient cars will be important to reduce emissions, but making new cars unaffordable, will only result in Australians keeping their current cars longer, or choosing a second-hand car, making emissions worse over time.”

“Labor wants to punish everyday Australians for choosing to drive the cars they need and love.”  

“The Coalition is willing to engage on emissions reduction measures and we support the take up of EVs, but we do not support policies that fail to strike a balance between getting emissions down, minimising costs and maximising choice for all Australians.”

Learn more at:


Media contacts:

O’Brien: Mitch Bland | 0401 257 064

­­­­­­­­­­­­­­­­On Background – EXPLAINER: What is the family car tax?

To reduce transport emissions, a vehicle efficiency standard has been proposed as a method of persuading car manufacturers to make and sell cleaner, lower emitting vehicles in Australia.

For this to be effective it must be applied gradually to enable manufacturers the time to develop more efficient technology and change product lines in a way that doesn’t excessively jack up the cost of vehicles for consumers or force certain models to exit the market that people love and need to drive.

Industry has admonished Labor’s proposal for overreaching, saying it has gone too hard too fast. At its core Labor’s proposal will tighten the screws on emissions standards for new vehicles in a way which is unachievable in an attempt to force manufacturers to stop cease certain cars for fear of penalties.

Industry experts have suggested that Labor’s penalty of $100 per g/km as part of its proposal could see fines of up to $38 billion applied to Australian vehicles which will ultimately be paid for by the customer.

For example, a Toyota Landcruiser currently has an emissions profile of over 235 g/km. In under five years Labor’s standard expects this vehicle to reduce to 81 g/km. This is unachievable, unaffordable and unrealistic and could see penalties of $25,000 on this vehicle. By 2027, 71 out of 76 Hybrids will not even meet Labor’s standard.

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