The Federation of Thai Industries (FTI) plans to hold discussions with the Ministry of Finance on the implementation of a tariff reduction for electric vehicles (EVs). The talks are intended to address complaints that such a move would heavily favor EVs from China.
FTI Chairman Kriengkrai Thiennukul made the announcement after federation members complained that tariffs on EVs from China would be completely waived in line with the ASEAN free trade agreement with China. They noted that under the tariff cut regulation, EV levies for other nations would remain at a steep 40%.
The Thai government earlier approved a motion from the Ministry of Finance to reduce import tariffs for completely built-up (CBU) units of battery electric vehicles (BEVs).
Under the approved measures, BEVs with a retail price of up to 2 million baht are entitled to a lower import duty of 40%, down from 80%.
For BEVs retailing at between 2-7 million baht, import duties dip from 80% to 60%. This reduction is only awarded to CBU units and is expected to cost the government about 60 billion baht in revenue.
Kriengkrai said discussions between the FTI and the finance ministry are expected to pave the way for the type of EV tax restructuring that would be beneficial to all sides.
The adjusted regulation could also help to keep EV manufacturing bases in the ASEAN bloc. Kriengkrai warned that uneven tariffs for imported EVs would likely discourage investors from local EV production, further complicating efforts to elevate Thailand as the EV manufacturing hub of ASEAN. (NNT)