THURSDAY, February 29, 2024
nationthailand

Excise Dept to propose continued support measures for EVs

Excise Dept to propose continued support measures for EVs

The Excise Department is planning to propose two approaches to extend state support for electric vehicles (EVs), according to the department’s director general Ekniti Nitithanprapas.

Noting that the 2.9 billion baht fund to support electric vehicle usage allocated by the government will be depleted by the end of September, the department is preparing to propose that the new government provide additional funds to ensure the continuity of the EV support program until 2025.

The government currently provides direct support to EV buyers through this support fund, with a maximum value of 150,000 baht per vehicle in the case of EVs with batteries of 30 kilowatt-hours per hour or more. For EVs with batteries less than 30 kilowatt-hours per hour, support of 7,000 baht per vehicle is provided.

Since the implementation of the support measures, some 20,000 EVs have been registered with the Department of Land Transport, showing a growth rate of up to 270%, which is the highest expansion rate among Asean countries.

Ekniti said that the budget to be requested from the government for this EV support programme is likely to be no less than 2.9 billion baht, depending on the growth rate of EV usage within the country. The support fund per vehicle is expected to remain at 150,000 baht although this is subject to the considerations of the new government and the allocated budget.

According to sources from the Excise Department, two approaches for continuous EV support are being proposed. The first, during the transitional period for the government, suggests allocating around 3 billion baht from the central budget. This allocation requires approval from the Cabinet and then another Cabinet proposal for committee approval.

 

The second approach is to request a budget allocation of 40 billion baht for the EV support measures during 2024-2025. Currently, the department has disbursed about 2 billion baht for the EV support measures, leaving about 1 billion baht to be disbursed by the end of September.

Government support for EV usage is provided to various car manufacturers that have signed agreements with the Excise Department to participate in this programme. These manufacturers are required to use the support funds to reduce the prices of their EVs for buyers. Currently, there are 11 car manufacturers and motorcycle producers participating in the programme. Import tax and excise tax reductions for EVs are also provided.

Car manufacturers receiving EV support funds from the government are required to establish EV production bases in Thailand starting from 2024. The production is to replace imported EVs (that receive government support). By 2024, a one-to-one replacement ratio will be required, meaning that for every imported EV that receives support, one EV must be produced domestically. If a car manufacturer cannot establish domestic EV production by 2024, they will need to achieve a 1-to-1.5 replacement ratio in 2025.

On February 15, 2022, the Cabinet approved the measures to support the use of Battery Electric Vehicles (BEVs) domestically, covering personal EVs, EV pickups, and EV motorcycles. These measures include import tax reductions, excise tax reductions for BEVs with prices not exceeding 2 million baht, and EV support funds from 2022 to 2025. 

For personal EVs priced at no more than 2 million baht, the import tax is reduced to 40%, while for imported EVs with prices ranging from 2 million baht to 7 million baht, the import tax is reduced to 20%. The excise tax is reduced to 2% from 8%.

Domestically produced EV pickups benefit from a 0% excise tax rate and additional support of 150,000 baht per vehicle, provided that they have a battery size of at least 30 kilowatt-hours per hour.

As for electric motorcycles with prices not exceeding 150,000 baht, the excise tax will be reduced to 1%, and additional support of 18,000 baht per vehicle will be provided, both for domestically produced and imported vehicles.

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