EU trade deal boosts choice for drivers

More choice for drivers, but outdated Luxury Car Tax must go

March 24, 2026: The Victorian Automotive Chamber of Commerce (VACC) has welcomed today’s Australia–European Union Free Trade Agreement, saying it will deliver greater choice for Victorian and Tasmanian drivers, but warned outdated taxes risk undermining the benefits.

VACC CEO Peter Jones said the agreement is a positive step for the automotive sector, particularly for local dealers and the communities they support.

“This deal is good news for drivers, it means more choice and more accessible vehicle options across the market,” Mr Jones said.

However, Mr Jones said the full benefit of the agreement would not be realised unless the Federal Government addresses outdated tax settings, particularly the Luxury Car Tax.

“You can’t open up trade on one hand and maintain outdated taxes on the other,” he said.

“The Luxury Car Tax is a legacy tax from a different era. It no longer reflects today’s automotive market and it’s holding back consumer choice.”

“If this agreement is about giving Australians better access to goods including vehicles, then removing the LCT needs to be part of the next step.”

The VACC will continue to advocate for practical policy settings that ensure the benefits of the agreement flow through to automotive businesses and the communities they serve.