The price of battery electric vehicles (BEVs) entitled to the state's subsidy and tax incentives will be reduced by at least 150,000-200,000 baht per car, said the Excise Department's director-general Lavaron Sangsnit.
The government has cut the excise tax of BEVs to 2% from 8% from now until 2026 and provided a subsidy of 70,000-150,000 baht per car to purchasers.
The supportive measures also include the reduction of BEV import duty to not over 40% from 80% in the case of import outside the free trade agreement. The reduction brings down the import duty of Japanese BEVs to 20%, South Korean BEVs to 40% and European BEVs to 40%.
BEVs imported from China have enjoyed 0% duty under a bilateral agreement.
On Monday the department signed an agreement with Great Wall Motor Manufacturing (Thailand) Co and MG Sales (Thailand) Co, involving a commitment to lower their BEV prices for consumers, in line with the government's subsidy and tax incentive measures launched to promote EV adoption in Thailand.
Mr Lavaron said that more car makers will enter into the same agreement with the department. The commitment is aimed at ensuring that car makers will pass on the state benefits to consumers.
Mr Lavaron said car makers qualified to gain the state support would have to comply with conditions. One condition requires they produce one BEV in Thailand per one BEV they import under the tax incentive measures. They have to start this 1:1 ratio of import-production in the third year of the measure's validity before increasing the ratio to 1:1.5 ratio in the fourth year.
Nutthakorn Utensute, the Excise Department's principal adviser in Excise Control System Development, said the government earmarked 3 billion baht to finance the subsidy for BEVs in the first year. The government will seek to borrow 40 billion baht during the next three years to fund this subsidy.
Mr Nutthakorn said BEVs can help owners save on their energy costs by around 100,000 baht per year compared with costs for drivers of oil-powered cars.