Excise Department moves forward with study to reduce battery tax

Bangkok, The Excise Department is moving forward with a study to reduce battery taxes to support the growth of electric vehicles. Mr. Ekanit Nitithanprapas, Director-General of the Excise Department, said that the Excise Department signed an MOU with car manufacturers through the EV 3.0 measure, in which the government compensates buyers for the price of electric cars by 150,000 baht per car, and the EV 3.5 measure, including motorcycles and 23 cars, by reducing import taxes from 8 percent to 2 percent. The private sector must invest in domestic EV production, with the condition that domestic materials are mainly used. For example, if 100,000 cars are imported in 2023, 100,000 cars must be produced domestically in 2024. If the production plant cannot be established in time by 2025, 1.5 times the number of cars must be produced, with a total investment of 40 billion baht. BYD is currently piloting domestic vehicle production to make Thailand a global EV production base, for both domestic sales and exports. T hen in 2026, the government set a plan to promote battery production, starting from setting up a cell unit factory (Cell to Module), producing cell groups, creating modules, and then producing multiple modules to create a large battery pack placed under the car to promote the production of the main components of electric vehicles. Currently, the private sector has applied for the BOI with an investment budget of 25 billion baht, which is considered to be beneficial to Thailand in many ways, both attracting investment to make Thailand a center for electric vehicle production, attracting investment into the country, creating production, employment, and becoming a production base for electric vehicle parts. It is expected to produce 1.8 million vehicles per year. It is expected that 50% of the production will be domestically produced and the remaining 50% will be exported because many international car manufacturers have contacted us to build factories in Thailand. Therefore, we must seize this opportunity beca use we have set a requirement to use 40% of domestic materials and parts from all car components. Therefore, the Excise Department must study the approach to attract investment in batteries. Initially, it was determined that if standard batteries are produced, durable, long-lasting, and large, the tax will be lower. If batteries are produced with lower quality, the tax will be higher. In order to use the tax measure as an incentive, it is preparing to propose to the Ministry of Finance to consider reducing the battery tax soon to propose to the Cabinet for further consideration. It will also propose to the Cabinet to allocate a budget to compensate for electric vehicles from the first round of 7 billion baht for 40,000 vehicles. When expanding the EV 3.5 measure, an additional budget of 7 billion baht will be requested for the 35,000-vehicle reservation. Source: Thai News Agency