Energy Min insists auto tax restructuring must be fair

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BANGKOK, 4 May 2011  – The Ministry of Energy has affirmed that the car excise tax restructuring must be conducted with utmost fairness after the Cabinet ordered a four-month review on the measure. 

As part of the 15-year Alternative Energy Development Plan, the Ministries of Energy, Finance and Industry came up with a measure to impose an excise tax increase on car producers, except for those who can manufacture vehicles that are energy efficient and safe with low emission. However, when the measure was proposed to the Cabinet, the three ministries were instructed to revise some of its detail and present the matter again in four months.

Energy Minister MD Wannarat Channukul said his ministry had informed the Cabinet that the Finance Ministry’s new tax formula, which was solely based on the amount of carbon dioxide released by each vehicle, needed to be adjusted. He explained that in order to be fair to all sides, the calculation should cover the entire process, ranging from the cultivation of crops for producing alternative energy to the emission of carbon dioxide in the end. He claimed that the method was in line with the international standard and would reveal a more accurate amount of carbon released and lower the tax on automakers as well.

Commenting on the promotion of hybrid cars which run on electricity, MD Wannarat expressed concern that the power demand would soar, in contrast to the declining supply. He added that the hybrid vehicles would also go against the Government’s effort to encourage the use of alternative energy.