- After eight years of negotiations, the Australian government and the European Union have agreed on a free trade deal.
- While plenty of the details remain to be confirmed, Aussies can expect lower prices for European wines, cars, chocolate, and more.
- Unfortunately, for those with finer tastes, the Luxury Car Tax remains in place, with a caveat for zero-emissions vehicles.
After nearly a decade of stop-start negotiations, Australia and the European Union have finally shaken hands on a free trade agreement that will see savings for Aussies everywhere.
What does it cover? If you have an eye for European cars, a weakness for good wine, or an honest relationship with a block of quality chocolate, it’s a rare DFAT announcement that’s genuinely worth paying attention to.
The new free trade deal will see the removal of most Australian tariffs on imports from the EU, making things like European wine, spirits, biscuits, chocolates, and pasta cheaper at checkouts across Australia. Tariffs will drop to zero from day one for key EU export products such as wine and sparkling wine, and confectionery, making it a very good day for anyone who’s been wanting to crack a guilt-free Côtes du Rhône during the middle of the week.
“This is a significant moment for our nation as we secure an agreement with the world’s second-largest economy,” Prime Minister Anthony Albanese told the press in Canberra today.
On the subject of cars, the news is particularly good for anyone who’s been eyeing a European EV. Australia will introduce a new category for the luxury car tax, allowing zero-emissions vehicles under $120,000 to enter without facing the 33 per cent levy previously applied to fuel-efficient cars worth over $91,000.
A separate five per cent tariff on imported cars has also been cut, meaning around 75% of electric vehicles from the EU will be exempted from paying the luxury car tax entirely. Unfortunately for those who’ve been considering anything with a throaty German or Italian roar, prices aren’t budging at this point.
For wine, the deal runs in both directions, meaning Australian wine exported to the EU will enter duty-free, resulting in an expected saving of $14.5 million per year for Australian exporters. The trade-off, however, is that Australian producers will no longer be able to export Prosecco after a ten-year phase-out period.
Unfortunately for anyone who’s been keen on a multi-year Eurotrip, the government has confirmed “no change to entry requirements for Australian travellers” despite hopes for an expansion of the Schengen Visa. What is good news for Aussie professionals, however, is that the new deal will make it easier to travel to and within the EU.
The deal is projected to add $10 billion to Australia’s GDP by 2030, which isn’t a bad result (as long as you don’t focus on the fact that it’s been in the works since 2018). Pop that bottle of Champagne, crack open a Toblerone, and enjoy a little respite from the relentlessly mounting cost of living pressures.
