Thailand approves tax breaks and subsidies for EVs – set of financial incentives to be in place until 2025

Thailand has announced a package of financial incentives, including tax cuts and subsidies, that it hopes will encourage a shift to electric vehicles (EVs). The package, which will be in place from this year until 2025, was approved by the Thai cabinet earlier this week, Reuters reports.

In the first two years, tax breaks and subsidies will be provided for imported EVs as well as those made locally. According to news reports, the measures for 2022 and 2023 include subsidies of between 70,000 baht (RM9,100) and 150,000 baht (RM19,500), depending on the model and battery capacity.

It will also reduce the excise tax from the current 8% to 2% for these vehicles, the latter the percentage carmakers that have been granted investment privileges from the Board of Investment (BoI) pay. Elsewhere, import duties will be lowered by between 20% and 40%.

From 2024 to 2025, support will mainly switch to promoting domestically produced EVs, while cancelling some benefits for imported models. “This is to encourage operators to accelerate the production of electric vehicles in the country to meet increasing demand,” government spokesperson Thanakorn Wangboonkongchana said. He added that the incentives would need to be worked out with the energy ministry.

The move also falls in line with the government’s ambition of getting 30% of the country’s total auto production to be electric by the end of the decade, as outlined in its EV roadmap that was unveiled last May. The roadmap, made up of a three-phase development plan, aims to have local manufacturing producing 725,000 electric cars and pick-ups plus 675,000 electric motorcycles by 2030.

The country, which is also targeting to have a total of 12,000 fast chargers in place by 2030, has already stated its intention to ban sales of new petrol and diesel cars by 2035.

Looking to sell your car? Sell it with Carro.