how does the tax affect supply or demand in the automobile industry?

Answer 1

Hi! Import duty has a profound impact on the costs of many of the new cars currently sold in Australia. Also the government's GST and luxury car tax has another profound impact. But to answer the question from outside the square - Australia just doesn't have the massive population base to support new car sales and manufacturing that countries like the U.S. and the U.K. do ........... therefore the manufacturer's product is going to be at a higher price here because of it's lower supply and is going to be higher than the same product sold in a substantially larger volume market elsewhere.
That's the raw truth of the matter.

Answer 2

Are youi talking about the gas and oil tax? It drives the price of gasoline and diesel up. As a result people stop shopping for and buying new cars opting to keep the cars they have to free up money they would have spent on car notes. Instead they use that portion of their income to buy gas with. And when they do buy a new it will be smaller less expensive with better fuel economy instead of larger luxury cars.

Answer 3

depends on what type of tax you're referring to.