Thailand to propose tax hike for combustion engine cars, pushing for EV adoption

The Thailand government and car companies will meet in January 2021 to discuss a proposal to increase the tax on combustion engine vehicles. Bangkok Post reports that the proposal is part of the effort to promote electric vehicles and reduce air pollution in Thailand.

The current excise tax structure is due to end in 2025, hence the proposal for the tax hike for combustion engine vehicles.

Electric cars in Thailand are currently enjoying a 3-year tax holiday, and the proposed tax hike (for combustion engine cars) is expected to accelerate the adoption of electric vehicles in Thailand.

Nissan Motor Thailand general manager for external and government affairs, Mr. Atthawit Techawiboonwong, said that increasing tax on combustion engine vehicles alone is not enough. Mr. Atthawit suggests corporate income tax rebate for companies buying EVs.

State egencies must also set a model for EV usage, according to Mr. Atthawit.

The Thailand 2030 EV roadmap aims for EVs to account for 30% of total annual car production by 2030.

While the tax holiday for EVs encourages the use of electric vehicles, the proposed excise tax hike on combustion engine cars (by 2026) will discourage the use of fossil fuel cars.