Liberal Government Scrapping Labour’s FBT Changes a Great Move

It is not very often that you find yourself in a position where you can heap praise on a Prime Minister, however Prime Minister Tony Abbott, Treasurer Joe Hockey and co. have done a great thing by the Australian Automotive Industry in scrapping the Rudd Governments Proposed FBT changes.

In a ludicrous decision by then-Prime Minister Rudd in July this year, the Rudd government decided to pull the pin on a raft of FBT-related benefits for Australian employees.

The announcement came as a significant shock to consumers and the Australian automotive industry was not consulted on the changes, angering many.

The Australian Salary Packaging Industry Association (ASPIA) released a statement that showed plenty of anger and dismay at the announcement, a sentiment held by many, and pointed to inaccuracies in the basis for the decision the government made.

According to an SBS interview, automotive industry leaders where stuck with fear for the ramifications down the line:

The Federal Chamber of Automotive Industries (FCAI) said the changes that start from Tuesday will have dire consequences, affecting both imported and domestically manufactured car sales.

“The effects will flow right through the industry, including to dealerships and service centres,” FCAI chief executive Tony Weber said in a statement.

“I want to know if the government truly understand the consequences of this decision, and why the industry was not consulted on such a significant change.”

The fears of many were correct with fleet vehicle sales taking a 10% dip in October.

Things should hopefully improve now that the Abbott government has overturned the mess created by the Rudd government.

Australian Salary Packaging Industry Association (ASPIA) president Leigh Penberthy welcomed the policy reversal “From an industry point of view we were hoping and waiting for this day to come, and even though the industry is well and truly back up on its feet, it needed that final verification that they’re not going to reverse their decision – they’re taking their election policy into government policy,”.

So now we wait to see if this common-sense policy change by the Abbott government improves fleet buying in months ahead.