From Credit Suisse this morning comes this useful calculation:
Proposed change: The proposed change is to remove the statutory formulae method for both salary sacrificed and employer provided cars. The implementation date is 1 April 2014 and based on the Government fact sheet, it appears that existing novated leases will be grandfathered.
Those impacted: The latest ATO statistics show that there are ~528k cars under the FBT legislation that are using the statutory value method. Of this, based on Treasury costings, we believe around 50% are salary sacrificed (~270k). We assume that the majority of the salary sacrificed vehicles would primarily be used privately and therefore that under the revised legislation that the proposed tax concessions would be far less attractive.
What it could mean for volumes: Assuming that novated leases last for on average 3-4 years, then ~90k vehicles may be impacted each year. FCAI data currently shows that ~80% of vehicles (~860k based on annualized 1.1mn volumes) are for passenger and SUV (residual light and heavy commercial). We would therefore estimate that the impact could be ~10% of new vehicle sales from a salary sacrificing perspective. However, we would assume a portion of individuals who would come directly back into the retail channel, so the impact may only be ~4-5% of total sales (1.1mn).
Looks to me like the net changes to the carbon price may result in fiscal drag.