On March 7, 2019, Mr. Nattakorn Uthenasut, Director of the Tax Planning Bureau of the Excise Department, revealed that the Cabinet has approved a reduction in car tax rates to address the issue of PM 2.5-PM 10 particulate matter. This includes a tax reduction for pickup trucks and four-door pickup trucks with diesel engines using B20 fuel by 0.5-1% from the current rate of 2.5-10%. Additionally, the tax rate for electric vehicles (EVs) will be reduced from 2% to 0% from January 1, 2020, to December 31, 2022, for a period of three years. This action will result in the Excise Department losing 1 billion baht in tax revenue annually, from an annual collection of approximately 100 billion baht, which is considered economically and environmentally worthwhile. 

          Furthermore, the production of EVs must comply with the conditions set by the Board of Investment (BOI), with registration for EV production having closed on December 31, 2018. A total of 13 companies registered, and it is believed that manufacturers will expedite their BOI approvals for EV production, as this could reduce the cost of each vehicle by 20,000 to 40,000 baht compared to the current prices of EVs in Thailand, which range from 1 to 2 million baht. 

          Meanwhile, the initiative to promote the use of B20 fuel in pickup trucks is expected to attract interest from four major automotive manufacturers in Thailand, who are likely to modify their vehicles to accommodate B20 fuel within this year. This change could reduce the excise tax by approximately 10,000 baht per vehicle. 

          “The department believes that this measure will encourage automotive manufacturers to enhance the emission standards of diesel vehicles to meet Euro 5 standards more quickly, which will lead to a reduction of PM emissions from pickup trucks and four-door pickup trucks that pay excise tax by 76 million grams annually, thereby reducing health impacts on the public and government healthcare costs,” Mr. Nattakorn stated.

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