The Cabinet has approved restructuring the excise tax on imported BEV (battery electric vehicles powered solely by batteries and driven by electric motors) and REEV (range-extended electric vehicles with hybrid fuel and electric power that can be charged and driven solely by electric motors) to a rate of 35% to strengthen the domestic automotive industry. This will take effect from 1 January 2027 onwards.
At the Cabinet meeting held on 3 Nov 2026 in Udon Thani province, Deputy Prime Minister and Minister of Finance, Mr. Akiniti Nititanprapas, revealed that the Cabinet approved adjusting the excise tax structure on imported BEV and REEV vehicles. Currently, BEVs are taxed at 10% and REEVs at 15%. The new tax rate will be set at 35%, effective from 1 January 2027 onwards.
This excise tax restructuring follows resolutions of the National Electric Vehicle Policy Committee from its 1/2025 meeting on 25 Nov 2025 and 1/2026 meeting on 10 Sep 2026, which tasked the Excise Department with implementing measures to incentivize investment in the manufacturing or assembly of key automotive components domestically. The aim is to maintain stability in Thailand's automotive industry amid intensifying competition from imported vehicles that do not benefit from government promotion measures. Therefore, tax restructuring is necessary to enhance technological competitiveness and strengthen the domestic automotive industry's supply chain.
The key principles guiding this excise tax restructuring for motor vehicles include: 1) promoting imports aimed at attracting investment (Investment-Driven Import), 2) establishing Thailand as a regional and global hub for environmentally friendly electric vehicles (Regional and Global EV Hub), and 3) upgrading the use of high value-added local parts (High Value-Added Local Content). The goal is to fortify the production chain, create jobs for Thai workers, and elevate their skills, thereby enabling the Thai automotive industry to transition from traditional manufacturing to becoming a leading center for producing and exporting environmentally friendly vehicles regionally and globally. This aligns with the government's Multi Path Way approach to alternative energy vehicles and its target to develop new economic growth engines by efficiently and sustainably building upon existing industries.
“This excise tax restructuring is intended to create fair competition for domestically produced vehicles and stimulate investment and production of electric vehicles within the country. Domestic vehicle and parts manufacturers will directly benefit in terms of production, employment, and throughout the supply chain. This will enhance the overall capability and competitiveness of Thailand's automotive and parts industry,” he stated.
