Thailand to lift imported EV tax to 35%

Thailand plans to raise the excise tax on fully imported electric vehicles to 35% from 10% from Jan. 1, 2027, Channel NewsAsia reported on Nov. 11.

The change could affect a fast-growing market where battery-electric passenger-vehicle sales nearly doubled to more than 161,000 in the first nine months of 2026, according to the Federation of Thai Industries.

The tax increase would widen the gap between imported models and qualifying vehicles built in Thailand, which currently face a 2% tax. The imported-vehicle levy would rise by 25 percentage points and stand more than 17 times the rate on qualifying local models, according to Atlas360 calculations. An excise tax is an indirect levy on the sale of a specific product or service.

The policy is designed to support domestic manufacturing, defend existing auto investment and draw Thai suppliers further into the electric-vehicle supply chain. Thailand wants zero-emission vehicles to make up at least 30% of domestic vehicle production by 2030.

“This is a corrective measure,” said Pavida Pananond, a professor of international business at Thammasat University. “The new tax is meant to restore a level playing field. The direction is right, but it comes late.

Chinese brands already dominate Thailand’s EV market,” she said.

Chinese-made EVs accounted for about three-quarters of all electric-car sales in Thailand in 2025, according to the International Energy Agency. Local production has been gaining share, but imports still account for much of the market.

Thailand imported almost $2.4 billion of electric passenger cars in the first nine months of 2026, with China representing 96% of that value, according to government data cited by Channel NewsAsia. Industry figures showed imported vehicles made up about 70% of EV sales in the period.

The tax change may prompt buyers to move before the deadline and could lead to higher prices for some models next year, experts said. It may also reshape competition between Chinese and Japanese automakers in a country long anchored by Japanese car production.

Krisda Utamote, an honorary adviser at the Electric Vehicle Association of Thailand, said he expects manufacturers to import vehicles and clear them through customs before Jan. 1. That could allow companies to sell existing stock under the old tax regime, limiting any immediate price rise.

For consumers, affordability remains central. Pichai Phungmai, a 66-year-old ride-hailing driver in Bangkok, said he is considering switching from a gas-converted Toyota Altis to an EV but would struggle with a large increase. “If the price of a car increased by 100,000 baht or more, I wouldn't be able to afford it,” he said.

Nuntapat Muangprasit, a 46-year-old noodle shop owner considering an EV to replace a diesel pickup truck, said he would look at locally made models if the tax change made them cheaper. “I would look at which locally produced models fit my budget and meet my needs. Price remains a major factor in my decision,” he said.

Pavida said there is also a risk that some brands drop imported models or leave the market rather than commit to local production.

On Jan. 1, 2027, the checkable point is whether Thailand implements the planned increase in the excise tax on fully imported EVs to 35% from 10%.

By Jan. 1, 2027, manufacturers may try to import and clear vehicles through customs before the deadline, Krisda said, allowing existing inventory to be sold under the previous tax structure.

From Jan. 1, 2027, the market test is whether prices rise immediately or whether pre-cleared inventory delays the effect, as Krisda said may happen.