Motorbike CO2 tax 'not aimed at profit'

Motorbike CO2 tax 'not aimed at profit'

Krisada: No burden passed to motorists
Krisada: No burden passed to motorists

The planned tax on motorcycles and oil that is to be based on carbon dioxide (CO2) emissions exceeding the maximum threshold is not aimed at making profits, but rather for environmental purposes, says the Excise Department.

The idea of imposing the excise tax on oil and motorcycles emitting CO2 above the required limit is still being considered by the Excise Department, but such a tax will not result in a greater burden for motorists, said director-general Krisada Chinavicharana Monday.

In the case of oil, the department is preparing appropriate measures for such taxation based on the CO2 emission standards, whereby it will discuss using the State Oil Fund with the Energy Ministry, said Mr Krisada.

Revenue from the State Oil Fund would be converted into the excise tax value and this would not cause retail oil prices to rise when the excise tax on oil based on the CO2 emission standards is implemented, he said.

For the tax on motorcycles, the taxation will only incur a marginally higher cost for people who are planning to buy them, said Mr Krisada.

For instance, the CO2 emission tax will be around 150-200 baht for a motorcycle valued at 50,000.

Earlier, Mr Krisada said the new excise tax on motorcycles based on CO2 emissions would add just 0.05% to retail prices if it was implemented.

The Excise Department, starting from January 2016, recalibrated the car tax, which was previously based on engine size, to CO2 emissions.

Under the current tax regime for cars, those with CO2 emissions of 100 grammes and less per kilometre are taxed 25%; those with CO2 emissions of 100-150g/km are subject to a 30% excise tax; those emitting 150-200g/km are taxed 35%; and those producing more than 200g/km are charged 40%.

The new tax rates mean that motorcycles sold in Thailand with higher CO2 emissions will be subject to higher tax rates and retail prices. Larger engine sizes typically release more emissions.

Separately, the Excise Department Monday signed a memorandum of understanding with the Thai Retailers Association, with a combined 17 shopping malls and convenience stores joining the agreement.

Mr Krisada said the Excise Department will use the price bases at five outlet models in order to determine retail prices.

The retail price base, he said, will therefore be derived from the prices at department stores, supermarkets, hypermarkets, convenience stores and mom-and-pop stores.

If the retail prices of two different store models match, then they will be used as the standard retail price for the Excise Department's tax calculation, said Mr Krisada.

Retail prices which are used as the basis for tax calculation have to be above 95% of the retail price value that the Excise Department surveys.

Do you like the content of this article?
COMMENT (4)