Thailand plans one-year extension of EV tax cut
The Transport Ministry is drafting a decree to extend the 80% annual tax cut for new EVs as registrations surge and fuel prices rise.
Thailand is preparing to extend its annual tax reduction for electric vehicles by another year, after a previous tax incentive helped push EV registrations far above expectations.
A source at the Ministry of Transport said the Department of Land Transport has drafted a new royal decree to reduce the annual tax for electric-powered vehicles, following the expiry of the previous decree.
The measure is intended to maintain momentum in EV adoption, support Thailand’s ambition to become a major EV production base, and ease the impact of rising fuel prices.
EV registrations exceed forecast
According to the Department of Land Transport, the previous Royal Decree on the Reduction of Annual Tax for Electric-Powered Vehicles B.E. 2565 expired on November 10, 2025.
During the period in which the decree was in force, 316,657 electric vehicles were registered. The figure was 2.46 times higher than the projected level had the tax reduction not been implemented.
The increase reflects significantly stronger demand for electric vehicles in Thailand, while also supporting the use of cleaner transport and efforts to reduce air pollution.
80% annual tax cut proposed
Under the draft royal decree, the annual tax rate for new factory-built electric vehicles would be reduced by 80% from the rate prescribed under the Motor Vehicle Act B.E. 2522 (1979), as amended by the Motor Vehicle Act (No. 14) B.E. 2550 (2007).
The reduction would apply to electric vehicles registered within three years from the date the new decree takes effect.
Each eligible vehicle would receive the reduced annual tax rate for one year from its registration date.
The previous DLT-backed incentive also offered an 80% annual tax reduction for electric-powered vehicles to encourage wider EV adoption.
Policy tied to EV production push
The proposed extension is in line with the government’s broader policy to promote domestic EV use and position Thailand as one of the world’s key EV production bases.
Authorities say the measure would help create incentives for people to switch to environmentally friendly vehicles, stimulate the EV manufacturing ecosystem and support the wider economy.
The policy is also aimed at reducing carbon dioxide emissions and cutting dependence on petrol and diesel vehicles at a time when fuel prices remain under pressure.
