Luxury Tax - What Price Applies?

[Calvin H-C]

We're about to finalize our purchase and pick up our Lightning and are wondering what price is used to determine if and what the luxury tax will be.

On our purchase agreement, there are two figures:

• Total sale price: $94,400
• Total vehicle price: $104,203

The first is the base price plus options selected. The second adds the extended warranty, maintenance package, and undercoating plus things like freight, A/C tax, and OMVIC and admin fees.

I've read what is in the CRA's website and can't say for sure what applies. I was under the impression that the first applies and no luxury tax will apply, and our sales rep suggested this at the time of ordering. Now he seems to think the second applies.

Regardless of what he thinks, they have an admin person who will go through the final numbers and give me a call, so she should know better than the sales rep.

Has anyone had a situation like this and can tell me what happened?

If they insist the tax applies, I'm going to skip purchasing the extended warranty and maintenance plan at this time as they can be added after - and purchased from another dealer (I'll remind them of that). That will bring the second price below $100k.

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[theshaneler]

https://www.canada.ca/en/services/t.../luxury-tax/consideration-retail-value.html#1

there is a list of what to include and what not to include.
relevant section here:
What not to include

The following are examples of what not to include in the value of consideration for calculating the luxury tax on the sale of a luxury item. This is not an exhaustive list.

....

• Extended warranties
• Repair, maintenance and service plans

 

[Calvin H-C]

What not to include

Thanks for that link. The page I was looking at didn't have that (I did a search for the word "warranty" among other things).

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