BDO Corporate Tax News

Thailand - Summary of EV-related and plastic waste incentives

Thailand is a leading automotive producer globally and in the ASEAN region. The country has set an ambitious target of having at least 30% of the cars made in Thailand being electric vehicles (EVs) by 2030 and is one of the first ASEAN countries to offer incentives for both the supply and demand side. Thailand’s National Electric Vehicle Policy Committee, chaired by the Prime Minister, has approved incentives to encourage companies to transition commercial fleets to battery-operated EVs (BEVs) and cash grants for EV battery cell manufacturers, which will supplement the support provided by Thailand to the EV ecosystem and promote the country as an EV manufacturing hub.

The following is a summary of the available incentives:
  • Special tax deduction for the use of electric powered buses and trucks: Under the scheme, qualifying companies purchasing domestically manufactured vehicles can deduct twice the actual price of the vehicles and 1.5 times the actual price for imported vehicles. Large electric vehicles eligible for the incentives include electric trucks for commercial use, such as container trucks, liquid trucks, hazardous substance trucks, special trucks and tow trucks, as well as electric buses. The incentives will be available through 31 December 2025.
  • Financial support for companies that manufacture battery cells for EVs and energy storage systems: To encourage EV battery manufacturing companies to invest in Thailand, financial support through the Competitiveness Enhancement Fund will be granted to qualifying companies. The incentives granted are in addition to the EV3 measures scheme that commenced in 2022.
  • Tax incentive to promote the reduction of carbon emissions: Introduced in 2023, Royal Decree No. 760 provides a corporate income tax exemption for three consecutive accounting periods for net profits derived from the sale of carbon credits in Thailand under the Voluntary Emission Reduction Program and must be claimed in accordance with rules, procedures and conditions prescribed by the Director-General of the Revenue Department. Entities also must be registered with the Thailand Greenhouse Gas Management Organisation. The decree applies from 19 March 2023 through 31 December 2027.
  • Additional deduction for purchase of bio-degradable plastic products: As part of the government’s efforts to encourage businesses to limit their consumption of biodegradable plastics and reduce plastic pollution, Royal Decree No. 749 dating from 2022 allows a company or legal partnership to claim a tax deduction of 1.25 times (one time as a normal deduction and 0.25 times as an additional deduction) the amount paid for the purchase of biodegradable plastic products from a VAT-registered manufacturer with a certificate to manufacture products from the Office of Industrial Economics, Ministry of Industry. The expenses must be paid during the period 1 January 2022 through 31 December 2024 and the company must submit a report.

Pakamon Charubhakti
BDO in Thailand
Please accept statistics-cookies to see the content.