Thai Commerce Board Pushes EV Tax Plan to Protect Local Auto Production

The Thai Chamber of Commerce has backed an Electric Vehicle Board decision from September 10, 2024, approving a restructured excise tax framework for electric vehicles. Under the proposal, domestically manufactured vehicles using high levels of locally sourced components would receive lower tax rates, while fully imported finished vehicles would face higher taxes.

The approach creates fair competition and incentivizes manufacturers to invest, produce, and develop Thailand's supply chain in earnest.

"EV promotion should not turn Thailand into merely an electric vehicle market, but must elevate it to become a manufacturing and export hub for future vehicles. The more a manufacturer invests, produces with Thai components, creates employment, and transfers technology, the more benefits they should receive," said Potsana Arimwatanannont, chairman of the Thai Chamber of Commerce and the Thai National Chamber of Commerce.

The Chamber has urged the government to clarify critical details, particularly local content and Thai content ratios, along with regulations for completely built-up vehicle imports, which should include appropriate volume caps and timeframes. Benefits should be allocated according to investment levels and economic value each manufacturer creates for Thailand.

The Chamber also stressed the importance of protecting existing automotive production strengths, notably pickup trucks, Thailand's flagship product category, as well as component manufacturers and Thai SMEs within the supply chain.

The Thai Chamber of Commerce is ready to work with the government and industry to advance measures balancing the transition to EV technology, consumer protection, and long-term competitiveness of Thailand's automotive sector.