Thailand Reforms EV Tax Structure to Boost Local Production

Thailand's national electric vehicle policy board has approved restructured excise tax rates for electric vehicles to drive the automotive industry transition toward world-class production capabilities. Nurtham Thawornsiriskul, secretary-general of the Board of Investment, announced the decision from the September 10 board meeting chaired by Deputy Prime Minister and Finance Minister Ek Niti Nitithanprapas.

The new tax structure rests on five pillars: attracting long-term investment through imports tied to domestic production, positioning Thailand as an EV manufacturing and export center, increasing use of high-value domestic components and raw materials, ensuring fair competition between domestic and imported vehicles, and strengthening Thai component manufacturers across the supply chain.

Imported EVs from companies without Thai manufacturing facilities will face higher tax rates, while manufacturers with domestic production bases importing specific models for market testing will have import volumes determined by local economic value creation. Locally-produced vehicles will receive consideration based on domestic component usage levels, particularly critical electronics components, with tax rates declining according to investment, production, and domestic value-added activities.

The board also approved two subcommittees: one for modern automotive and component manufacturing development under the Industry Minister, responsible for lifecycle production chain development including used EV battery and vehicle scrap management; and another for EV charging infrastructure under the Energy Minister, to ensure adequate infrastructure and update relevant regulations.

EV market registrations in the first seven months of 2025 reached 126,950 battery electric vehicles, up 88% year-on-year, with broader xEV category vehicles (BEV, HEV, and PHEV) accounting for 55% of total vehicle registrations, reflecting Thailand's clear market shift toward electric technologies.

As of August 31, 2025, the Board of Investment has promoted 189 EV-related industry projects with total investment of 151.4 billion baht, comprising 87.1 billion for battery production, 38.6 billion for BEV manufacturing, and 12.6 billion for critical component production. Promoted charging station projects plan to install 23,135 chargers, including 10,249 fast chargers, representing approximately 85% of the 12,000-charger target for 2030.

Mitsubishi, Honda, Mazda, and Isuzu, all with Thai manufacturing bases, plan additional combined investments exceeding 50 billion baht for new model development and production line upgrades using automation and robotics.