Thailand to overhaul excise tax as EVs capture 55 pct of new car market

BANGKOK, Sept. 10 (Xinhua) -- Thailand will tie automakers' excise tax rates and import quotas directly to their local value creation after electric and hybrid vehicles captured a record 55 percent of new car sales in the first seven months of 2026, the country's Board of Investment (BOI) said on Thursday.

Staff members work at the electric vehicle (EV) factory of China's carmaker GAC Aion in Rayong province, Thailand on July 17, 2024. (Photo: Xinhua)

The National Electric Vehicle (EV) Policy Committee, chaired by Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas, agreed in principle to the overhaul, which marks the first time combined pure-EV, hybrid, and plug-in hybrid registrations have outperformed combustion-engine cars in Thailand.

Under the new four-tier system, importers with no Thai manufacturing base will face the highest excise taxes, while automakers with existing domestic plants get import quotas linked to the economic value they generated locally in the previous year, the BOI said in a statement.

Domestic assemblers receive reduced excise brackets, with preferential rates tiered between vehicles with moderate local content and models achieving deep localization of critical electronic components, the state investment promotion agency said.

The Southeast Asian country's automotive sector must transition from rapid consumer demand to long-term capital formation, localized technology, and quality employment, said Narit Therdsteerasukdi, secretary-general of the BOI and secretary of the policy committee.

According to the BOI, approved investment in the Thai EV ecosystem has reached 4.59 billion U.S. dollars across 189 projects by August, led by battery cell and pack manufacturing, battery-EV assembly, and core component production.