PHEVs With Over 80 KM E-Range Get 5% Tax Break in Thailand

Thailand has approved major tax revisions to drive demand for plug-in hybrid electric vehicles (PHEVs) and position itself as a production hub for next-generation vehicles.

Starting Jan 1, 2026, the new excise tax structure offers clearer, globally aligned incentives for PHEVs.

A key change as reported by Bangkok Post is the separation of PHEV tax policy from hybrid electric vehicles (HEVs). Taxation will now be based solely on electric-only driving range, removing the outdated 45-litre fuel tank limit.

Deputy Finance Minister Paopoom Rojanasakul said the old rule discouraged both investment and consumer adoption. “It added unnecessary restrictions,” he noted.

Under the new policy, PHEVs with an electric range of 80 KM or more will be taxed at 5%. Those with shorter ranges will face a 10% tax.

This aligns Thailand’s regulations with global standards, boosting its appeal to automakers focused on local and export markets.

“This is a good move as buyers want EVs with long range hence why PHEV is ideal,” said Surapong Paisitpatanapong, vice-chairman of the Federation of Thai Industries.

He said consumer interest in xEVs remains strong, citing solid uptake at the Bangkok International Motor Show and continued sales momentum afterward.

“It shows this buyer segment is financially healthy,” Surapong added, despite ongoing financing challenges in the market weighed down by limited access to auto financing.

The government hopes the new policy will accelerate both urban and intercity PHEV adoption, spur manufacturing, and support Thailand’s EV roadmap.

Back home in Malaysia however, lack of clear direction is becoming evident watching the evolution that is happening in Thailand.

Uncertainty surrounds the government’s support for local xEV assembly, especially as the EV CBU import duty exemption ends in 2025 followed by CKD exemption in 2027.

Although the National Energy Transition Roadmap (NETR) sets targets of 20% xEV sales by 2030, 50% by 2040, and 80% by 2050, little concrete action has followed.

Five months into the year, little has been announced. Industry players remain uncertain, and many are reluctant to commit to local assembly without a clearer policy direction.

Without coherent and sustained support, Malaysia risks falling behind in the race to become a serious player in the regional xEV space.

Source: Bangkok Post