INSTANT ASSET WRITE-OFF EXTENSION

AADA has congratulated the Federal Government for extending the expanded instant asset write-off until the end of the year.

AADA CEO James Voortman said it was very welcome news for car Dealers and hoped it would help the industry recover from the significant downturn in new car sales.

“I would like to congratulate the Government on this announcement which will encourage businesses to invest during a time in which our economy will need it,” he said.

“I would urge eligible businesses looking to invest in a vehicle to do so before the end of the financial year as there are some very good deals to be had.

“While this is very welcome news, we will continue to call on the Government to remove the car limit of $57,581 which applies to the instant asset write-off. There is no justification for a car limit. There are no limits on other goods, and we’ll be asking the Government to review this.”

The ATO have recently advised that the car cost limit for depreciation increases to $59,136 for the 2020-2021 financial year. This is a very modest increase on an arbitrary threshold which AADA will continue to argue holds back the full potential of the scheme and discriminates against one class of asset.

The AADA has been calling for the extension of the instant asset write-off along with a number of other measures to help the industry through this difficult time.

New car sales have been falling for 26 months in a row, and sales figures in April and May saw some of the biggest declines on record due to the effects of the COVID-19 pandemic.

New car Dealers employ around 60,000 people in cities and country towns across Australia and are responsible for more than $55 billion in sales.

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