Thailand is set to implement a revised excise tax structure for plug-in hybrid electric vehicles (PHEVs) in 2026 to strengthen its position as a production hub. The Excise Department aims to remove outdated restrictions and align incentives with global standards to attract investment. Key revisions on requirements and conditions are as follows:
- Separate PHEV and EV Tax Policies: The new framework distinguishes PHEVs from fully electric vehicles (EVs).
- Removal of Fuel Tank Size Requirement: The 45-litre limit will be scrapped, reducing manufacturing costs and regulatory hurdles.
- Elimination of CO2 Emission Criteria: Tax rates will no longer be based on carbon emissions, shifting focus to battery advancements.
- Tax Based on Electric Range: Vehicles with longer electric range per charge will have lower tax rates. The current 5% tax for PHEVs exceeding 80 km per charge and 10% for shorter-range models is expected to continue with refinements.
These changes encourage investment while supporting Thailand’s transition from internal combustion engine (ICE) vehicles to full EV adoption.
The Ministry of Finance plans to present these measures to the cabinet by April 2025, with further details to follow. The government is also revising EV battery taxes, replacing the current 8% flat rate with a tiered system based on efficiency and lifespan. In addition, EV importers receiving incentives must manufacture vehicles domestically, with an estimated 100,000 locally produced EVs expected in 2026.