It is inevitable Thailand will introduce a carbon tax to match the global trend, says Excise Department director-general Ekniti Nitithanprapas.
EU members are among the first countries to impose the tax, slated for next year, beginning with products or processes with high carbon dioxide emissions, such as cement, iron, aluminium, fertiliser and the electricity production process, said Mr Ekniti.
Even if Thailand does not levy this tax on local products, its exports to markets that charge this tax will be charged, he said.
If Thailand does impose this tax, the country can bargain with export markets to waive the tax on Thai products, said Mr Ekniti.
He said in the global market there are two ways to impose the carbon tax: a levy on carbon dioxide-emitting products, or on factories' production processes that emit carbon dioxide.
The introduction of a carbon tax also serves the department's policy of promoting the environmental, social and governance (ESG) concept in its tax measures.
Mr Ekniti said the department is operating amid four major influences: Thailand's economic recovery during the Russia-Ukraine war, which is causing rising energy prices; digital disruption; the ageing society trend; and climate change.
Last week he revealed the department plans to study tax measures to support the production of bioplastics, bio jet fuel and environmentally friendly batteries.
The agency is also emphasising the importance of the ESG model to drive economic expansion via tax measures that support ESG practices.
In fiscal 2023, beginning on Oct 1, the department plans to begin its study on how to use tax measures to promote the production of bioplastics, bio jet fuel and recyclable batteries for electric vehicles (EVs).
The department will also consider reducing the tax on ethanol if it is used for the production of bioplastics or bio jet fuel in an effort to promote environmental protection, said Mr Ekniti.
In the future, the department might lower the excise tax on recyclable EV batteries to 2%.
Currently it imposes the same flat rate of 8% on conventional and EV batteries, he said.