The federal government's luxury car tax increase has been defeated in the Senate.
Family First senator Steve Fielding sided with the coalition to vote down the legislation at the second reading, 34 votes to 33.
The bill was set to be defeated Wednesday night, but coalition Senator Sue Boyce failed to show up to cast her vote.
The opposition moved first thing Thursday morning to have the vote recommitted.
The government wanted to increase the luxury car tax from 25 per cent to 33 per cent on vehicles worth more than $57,180. The defeat of the bill will cost the government an estimated $555 million in lost revenue.
Senator Fielding had wanted to exempt farmers and those in the tourism industry who use cars, worth more than the tax threshold of $57,180, as tools of trade.
"I just tend to think that maybe the Rudd government thinks they can get away with slugging farmers and tourism operators," he told ABC Radio on Thursday.
"There's no way we can vote for this if they're not looked after."
Treasurer Wayne Swan said on Thursday Senator Fielding's requests had been unreasonable.
"His request simply couldn't be implemented, it would have been a compliance nightmare," Mr Swan told ABC Radio before the vote.
"But it's not too late for the Liberal Party to actually demonstrate some economic responsibility in the Senate on Thursday.
"Essentially, what the Liberal Party is doing is supporting a tax cut for owners of luxury cars."
The Australian Greens and independent Nick Xenophon sided with Labor to allow the bill to proceed to its final stage.
Greens leader Bob Brown criticised Senator Fielding for opposing the bill, saying opposition would prevent any further debate on the issue.
"The government ... simply doesn't know what Senator Fielding's doing, nor does anyone else in the Senate," he told ABC Radio.
"I don't even know if Senator Fielding knows what he's doing."
Earlier, Opposition Leader Brendan Nelson sought to downplay Wednesday night's embarrassing vote, saying everyone made mistakes from time to time.
"Most senators and members (of the lower house) over the period of their parliamentary life unavoidably will miss a division, but the will of the Senate was obvious and I understand the matter will be dealt with again today," he told ABC Radio.
"All I can say is she will be there today."
Meanwhile, the automotive industry has welcomed the Senate decision to knock down a government plan to raise the tax on luxury cars.
"We very much welcome the vote by the Senate today to reject the tax increase in the luxury car tax," Federal Chamber of Automotive Industries chief executive Andrew McKellar told reporters.
"This was always bad policy and the Senate was right to reject it."
The tax would have hit farmers and tourism operators, Mr McKellar said.
"For that reason it is a correct move by the Senate."