Thailand Revamps PHEV Taxes, Prioritising Electric Range and Scrapping Fuel Tank Limits

New Excise Duty Structure Aims to Boost Electric Vehicle Adoption from 2026

 

The Thai Cabinet, on Tuesday, has approved a significant overhaul of the excise duty system for plug-in hybrid electric vehicles (PHEVs), shifting the focus to electric driving range as the primary determinant for taxation.

 

Effective from 1st January 2026, PHEVs capable of travelling at least 80 kilometres on a single electric charge will benefit from a lower 5% excise duty rate.

 

In a parallel move, the previous regulation imposing a 45-litre limit on fuel tank capacity has been abolished.

 

Deputy Finance Minister Dr Paopoom Rojanasakul announced the changes today, following the Cabinet's approval of the Excise Department's proposed Ministerial Regulation.
  

The key objective is to create a clearer distinction in tax treatment between PHEVs and standard hybrid electric vehicles (HEVs), with the electric driving range becoming the sole criterion for calculating excise duty.

 

The removal of the fuel tank restriction is seen as a crucial step in positioning Thailand as a more attractive manufacturing base for PHEVs that meet global standards.

 

Officials had noted that the previous rule necessitated the production of non-standard fuel tanks, creating unnecessary complications and hindering the appeal of PHEVs to consumers.
  



 

Under the revised tax structure:


PHEV passenger cars and vehicles with up to 10 seats, meeting the Director-General's specifications and achieving an electric range of 80 kilometres or more per charge, will be taxed at 5%.
PHEV passenger cars and vehicles with up to 10 seats, meeting the Director-General's specifications but with an electric range below 80 kilometres per charge, will be subject to a 10% excise duty.


 

The government anticipates that these changes, aligning with international trends, will stimulate domestic and international demand for PHEVs, attract greater investment in Thailand's automotive industry, and promote the use of electric power in urban areas, with hybrid power for longer journeys.

(2025/04/29-00:00)