The National Electric Vehicle Policy Committee (EV Board) has approved revisions to Thailand’s car tax structure to encourage hybrid and electric vehicle production, aiming to solidify the nation’s position as a regional hub for EV manufacturing. The changes, announced yesterday by the committee chaired by Prime Minister Paetongtarn Shinawatra, align with broader plans to shift from internal combustion engines to electric power.
Narit Therdsteerasukdi, secretary-general of the Board of Investment, highlighted that the new structure targets hybrid electric vehicles (HEVs) and mild hybrid electric vehicles (MHEVs) with no more than 10 seats. To qualify for reduced excise taxes, manufacturers must invest at least three billion baht in HEV production or one billion baht for MHEV production, meet stringent CO2 emission standards, and incorporate local parts.
Starting in 2026, vehicles emitting less than 100 grams of CO2 per kilometer will face an excise tax rate of 6% for HEVs and 10% for MHEVs. Those emitting between 101-120g/km will be taxed at 9% and 12%, respectively. The incentives are in place until 2032, offering long-term predictability for automakers.
The EV Board also extended the production period under its EV3 measure, which supports battery electric vehicle (BEV) production with subsidies, import duty reductions, and tax cuts. Previously, manufacturers were required to maintain a 1:1 import-to-production ratio by 2024, escalating to 1:1.5 by 2025. To address falling car sales, the board has introduced a more flexible timeline under the EV3.5 package, allowing for 1:2 and 1:3 ratios in 2026 and 2027, albeit with fewer incentives than earlier programs.
Despite concerns from some manufacturers about potential pricing disparities between locally produced EVs and imported models under EV3.5, the government remains committed to fostering industry growth. Over 84,000 EVs were imported between 2022 and 2023 under the existing scheme, necessitating substantial production increases in the coming years to meet policy targets.
Prime Minister Shinawatra’s EV Board anticipates that these adjustments will accelerate Thailand’s transition to cleaner transportation, strengthen local manufacturing, and bolster the nation’s economic standing in the EV sector.
