Thailand approves tax incentives to lure EV production

Thailand approves tax incentives to lure EV production

Governments across ASEAN are battling it out for foreign investment, and even better if it’s in sectors that are viewed as future. Electric cars are certainly in that category.

Indonesia, which has reserves of elements needed to make EV batteries, has made moves to promote EVs, and is even talking to Tesla regarding potential investment. Toyota has already stated its plan to making EVs in the republic, while Hyundai and LG Chem are mulling a battery plant in the region’s biggest country. Even Singapore is in on the act, with Hyundai setting up an EV lab and factory there.

Thailand, the original regional production hub for carmakers, has had early success in luring carmakers to its sunny shores – small eco cars and pick-up trucks are made there for global export. But the Detroit of the East doesn’t want to be left out of the EV gold rush, so it’s now rolling out fresh incentives for manufactures to set up shop there.

Thailand approves tax incentives to lure EV production

Thailand’s Board of Investment (BoI) chaired by PM Prayut Chan-o-cha has approved a new privilege package for EV makers following the expiration of the previous package in 2018. The Bangkok Post reports that the new deal includes a three-year tax holiday for manufacturers of plug-in hybrid vehicles and a maximum eight-year corporate income tax waiver for makers of full EVs.

This is part of the country’s wider 2030 EV roadmap, which is targeting EVs to account for 30% of total annual car production – or 750,000 units out of 2.5 million – by 2030. Our neighbour will also lower taxes to boost local demand for CKD EVs.

BoI secretary-general Duangjai Asawachintachit said the new package covers all major aspects of the supply chain, including parts, commercial vehicles of all sizes and even ships. For four-wheeled full EVs, those investing a minimum of five billion baht will get an eight-year corporate income tax exemption, with additional privileges if they invest in R&D. Companies investing less than five billion baht will be entitled to a three-year tax holiday, with additional privileges for specific targets.

Thailand approves tax incentives to lure EV production

Thailand’s BoI is also adding four more parts to the list of significant EV parts eligible for incentives, including high-voltage harnesses, reduction gears, battery cooling systems and regenerative braking systems. Makers of these four items will receive eight years of corporate tax exemption.

Last but not least, to promote production of EV battery modules and cells, Thailand will grant a 90% reduction in import duties for two years for raw material not found locally, partly removing one hurdle as these essential ingredients aren’t commonly available. Indonesia is said to be an attractive location for EV battery manufacturing due to its status as a major producer of nickel, which is a key component in EV batteries.

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Danny Tan

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

 

Comments

  • Ghani on Nov 06, 2020 at 1:48 pm

    Luckily our MAI been far ahead leading in EV production plan since NAP 2010. Just to name a few… Porsche Taycan, MINI Cooper SE & Hyundai Ioniq part of MAI successful EV development plan in MY.

    Like or Dislike: Thumb up 14 Thumb down 5
  • Bieight on Nov 06, 2020 at 1:51 pm

    Meanwhile in Malaysia we have flying cars…

    Like or Dislike: Thumb up 8 Thumb down 2
    • Rosman on Nov 06, 2020 at 6:06 pm

      All this our pipu inspired by P ramlee magic flying carpet…. Zam zam alakazam bebey!!

      Like or Dislike: Thumb up 8 Thumb down 0
  • KUNTA KUNCHI on Nov 06, 2020 at 1:56 pm

    Malaysia…always left behind…whats left are the crumbs..by the way…the flying car..any news kah?People are planning to export 700000 units yearly comprising mostly Japanese marques.Here,we have dudes who fantasize about flying cars.Just pathetic and shambolic.

    Like or Dislike: Thumb up 12 Thumb down 0
  • With the accompanying toxic waste from battery manufacturing. Well done Thai authority. No wonder the people are protesting against you. !!!

    Like or Dislike: Thumb up 7 Thumb down 6
    • boring on Nov 06, 2020 at 5:08 pm

      next level logic. but hey its the internet, must be correct.

      Like or Dislike: Thumb up 0 Thumb down 0
      • Edwin L on Nov 06, 2020 at 5:59 pm

        Most people on the internet don’t think that far anyways. I tip my hat off to Alan.

        Like or Dislike: Thumb up 2 Thumb down 0
  • Skeptik on Nov 06, 2020 at 2:43 pm

    Malaysia could’ve been leader in ASEAN EV, but all talent migrate to US,SG,UK oledi

    Like or Dislike: Thumb up 9 Thumb down 3
    • Yup. But all those talents couldn’t figure out how to pull a power cord from a 14th storey flat to charge EV car and they gave up and left. Feel so sorry for them.

      Like or Dislike: Thumb up 5 Thumb down 4
  • vivizurianti on Nov 06, 2020 at 3:46 pm

    No worries and be happy guys.

    We Malaysian soon will be zooming here and there in the air. Kl to Ipoh just 45 mins. Everyone can have flying cars. Salute and thanks to our visionary minister!

    Like or Dislike: Thumb up 6 Thumb down 1
  • Reader on Nov 06, 2020 at 6:12 pm

    Meanwhile in bolehland, NAP keeps getting delayed..

    Like or Dislike: Thumb up 3 Thumb down 0
  • Fariz on Nov 07, 2020 at 7:06 pm

    Sampai bila rakyat Malaysia nak drive petrol cars …

    Like or Dislike: Thumb up 2 Thumb down 0
 

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