Thailand to Raise Excise Tax on Imported Electric Vehicles to 35% from 2027

Thai officials announced on 3 November 2026 that the nation will raise the excise tax on fully imported battery‑electric vehicles (BEVs) and range‑extended electric vehicles (REEVs) to 35 per cent, effective 1 January 2027. The new tariff replaces the existing 10 per cent rate on BEVs and 15 per cent on REEVs, a change approved by the cabinet in a meeting held in Udon Thani.

The decision follows guidance from the National Electric Vehicle Policy Committee and the Finance Ministry, which aim to strengthen Thailand’s production chain and bring investment into local EV manufacturing. Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas said the cabinet had approved the change, noting the policy was intended to protect the domestic auto industry and encourage more production within the country.

BEVs run exclusively on battery power and electric motors; REEVs combine fuel and electric power but can be plugged in and driven solely by electric motors. Under the new rules, any vehicle that has been produced entirely abroad and brought into Thailand will face a 35 per cent duty, making imported models more expensive compared to those assembled locally.

This policy shift is expected to level the playing field for cars built in Thailand and spur investment in local EV production. The higher duty will also boost employment throughout the supply chain, creating jobs for Thai workers and enhancing the competitiveness of Thai auto and parts manufacturers in the region.

For consumers, the change could raise the price of imported EVs, potentially shifting demand toward models that are assembled or partially assembled in Thailand. Exporters of EV components and firms that rely on imported vehicle bodies may also feel the impact as their costs rise.

Industry analysts expect the 35 per cent excise to accelerate the domestic industry's growth, encouraging local firms to upgrade their skills and production capacity. The government’s goal is to position Thailand as a regional and global hub for green vehicle manufacturing.

While the policy is aimed at bolstering local manufacturing, it is also part of a broader strategy to increase Thailand’s export potential for car components and electronics. By offering a more favourable environment for domestic assembly, the country hopes to attract foreign direct investment and strengthen its role in the global EV supply chain.

The tax hike will be in effect from 1 January 2027. Until then, imported BEVs will continue to pay the 10 per cent duty, and REEVs will pay 15 per cent. Afterward, all imported electric vehicles of the two categories will face the 35 per cent tariff, regardless of whether they are fully imported or assembled with Thai parts.

Local stakeholders are closely watching the outcome. Automobile manufacturers that rely heavily on imported parts will likely seek to diversify suppliers or bring more manufacturing into the country to mitigate the higher costs. Conversely, firms with strong domestic production lines could benefit from increased market share as foreign competition becomes more expensive.

The Thai government has not issued a separate regulation detailing the exact methods for calculating the new excise rates, but officials have indicated that the 35 per cent figure will apply uniformly across all fully imported electric vehicles.

While the policy is designed to support local industry, critics argue that it may limit consumer choice and create market distortions if the subsidy advantages for Thai‑produced vehicles are not matched by comparable technology or price competitive advantages.

Overall, the cabinet’s decision appears to signal a new phase in Thailand’s automotive strategy, aligning domestic production incentives with global trends towards sustainable mobility and regional integration.