Huge tax breaks to push switch from old cars to new and EV
The government will offer tax incentives for individuals and companies to exchange their old cars for new cars or electric vehicles, Industry Minister Suriya Juangroongruangkit told the “New Generation of Automotives” seminar hosted by Krungthep Turakij newspaper on Thursday.
The scheme will apply to used cars 15 years old or older and will boost sales of new cars and e-vehicles, he said. The ministry also aims to recycle the used cars.
The government will offer income tax deductions of up to Bt100,000 for companies and individuals who join the scheme, which will be proposed for Cabinet approval in the next two or three months.
The tax break will be offered for five years, said Suriya, adding that he will finalise details of the tax package with Finance Minister Predee Daochai soon.
“The government may lose some tax revenue [due to the scheme], but in return we will cut PM2.5 air pollution and boost car sales that have been badly hit by Covid-19. It will also boost the adoption of electric cars,” he said.
The tax break would not immediately boost demand for e-cars, since their price is currently higher than combustion-engine cars, Suriya said. But once prices dropped to the same level, it will help tip the balance in favour of e-cars.
Countries in Europe have offered similar incentives for consumers to switch to electric cars.