Toyota Prius tax claims disputed

Toyota Prius tax claims disputed

The Nation Associate Anti-Corruption Network (NACN) has asked the Finance Ministry to launch a probe into whether Toyota Motors (Thailand) has understated taxes by claiming the Toyota Prius is a completely knocked-down (CKD) vehicle.

It wants Finance Minister Sommai Phasee to investigate whether the hybrid car is a CKD — totally assembled in Thailand — or an imported car, as the latter is subject to 187.75% tax.

If it is an imported car, Toyota would be liable for tax of about 30 billion baht for domestic Prius sales, not 11 billion as recently demanded by the Customs Department, NACN secretary-general Mongkolkit Suksintharanon said.

The department has told the Japanese car maker to pay 11 billion baht for retroactive tax for importing Prius parts from 2010-12 without its approval.      

Under the Japan-Thailand Economic Partnership Agreement, car makers that receive the department's approval before importing parts are subject to 30% tax for CKD vehicles.

However, Toyota is subject to an 80% tariff since it did not seek approval.

Mr Mongkolkit claims Toyota's Thai unit did not have an assembly line for the Prius.

Sompong Phaoenchoke, managing director of Thai Rung Union Car Plc, said customs law had some loopholes that could be exploited by car makers.

It would be possible for a manufacturer to import a whole car without customs duties, he said.

Earlier, Toyota said all Prius cars sold in Thailand were made at its plant in Chachoengsao.

It imports hybrid parts from Japan without duties, as Thai manufacturers cannot make main parts for hybrids.

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