Bangkok: Deputy Finance Minister, Mr. Paopum Rojanasakul, announced preparations for a gradual adjustment in the vehicle tax structure aimed at bolstering the use of locally produced automotive parts. This initiative seeks to enhance Thailand's automotive competitiveness by increasing the incorporation of Local Content in vehicle assembly, thereby revitalizing the domestic production sector. The plan also addresses the management of the second-hand car market and the recent impact of the electric vehicle (EV) price war on new car sales.
According to Thai News Agency, Mr. Rojanasakul highlighted the challenges faced by Thailand's automotive industry, which has experienced a slowdown due to the rapid emergence of the EV sector. To remain competitive, the industry must adapt by increasing the use of parts produced within Thailand. The Ministry of Finance, through the Excise Department, is currently studying a tiered tax structure that would incentivize the use of Local Content by offering greater tax reductions for higher proportions of locally sourced parts. This strategy aims to boost local employment and production.
The Ministry of Finance is also considering tax measures for passenger cars using traditional fuels, while support for EVs will be addressed in a subsequent phase. The Deputy Minister emphasized a balanced transition to the EV era, ensuring that existing industries, including small and medium-sized enterprises and labor sectors, continue to thrive. The government stresses the need for increased domestic production in both imported electric and combustion vehicles.
The used car market has also been affected by a reduced supply chain and the slowdown in new car sales. Confidence in the quality of used vehicles is pivotal for market recovery. Mr. Rojanasakul suggested that collaboration with expert agencies could enhance consumer confidence in purchasing used cars.
Regarding the situation with NETA Electric Vehicle Company, which has not met production commitments under the EV 3.0 support measures, the Deputy Minister noted that the matter is being prepared for review by the National Electric Vehicle Policy Committee (EV Board). He expressed optimism that a resolution would be reached swiftly.
Mr. Suroj Sangsanit, President of the Thai Electric Vehicle Association, described the NETA case as a crucial lesson, underscoring the need for the government to implement measures to prevent similar issues in the future. He reassured consumers who have invested in NETA vehicles, pointing out the availability of skilled mechanics in Thailand to provide necessary support. The association is now conducting a detailed analysis of the situation, anticipating stricter regulatory oversight to emerge.