Thailand is preparing to introduce changes to its automotive taxation policy, with the Excise Department set to implement a new car tax structure on January 1st, 2026.
The revision aims to align the country’s automotive industry with evolving mobility standards. The following outlines the tax rates applicable to each vehicle category. So, will Malaysia follow this move to reduce import duties for PHEV also?
Open excise tax rates for automobiles (2026)
Electric vehicle group
Under the revised structure, the excise tax rate for general electric vehicles (EVs) will be reduced from 8% to 2%. For electric pickup trucks, the rate will increase from 0% to 2%. This change is expected to result in a moderate adjustment in overall EV pricing.
Plug-in hybrid electric vehicle (PHEV) group
Taxation for plug-in hybrid vehicles will be determined by the model’s electric-only range and emissions, as outlined below:
– 5% tax: For models capable of running 80 kilometres or more on electric power per charge.
– 10% tax: For models capable of running less than 80 kilometres on electric power per charge.
Additional conditions: Vehicles must be equipped with at least two advanced driving assistance systems (ADAS), and from 2026 onwards, batteries must be manufactured in Thailand.
Hybrid (HEV) and mild hybrid (MHEV) vehicles
The excise tax for hybrid and mild hybrid vehicles will remain fixed for seven years (until 2032):
– 6% tax: For vehicles emitting no more than 100 g/km of CO2.
– 9% tax: For vehicles emitting more than 100 g/km but less than 120 g/km of CO2.
Impact: Buyers of PHEVs with electric ranges exceeding 80 kilometres (like the HAVAL H6 and Jaecoo PHEV) will be eligible for a lower tax rate. Hybrid and mild hybrid vehicle prices are expected to remain relatively stable during the specified period.
Internal combustion engine (ICE) and luxury vehicles
Tax rates for vehicles with internal combustion engines will increase to reduce support for conventional powertrains. The changes are as follows:
– Engines above 3,000 cc: The excise tax rate will rise from approximately 40% to 50%.
Impact: Luxury vehicles and high-performance models with large engines, such as 4.0-litre V8s, may see price increases ranging from THB 2 to 3 million (US$ 61,930-92,890). Consumers planning to purchase these vehicles may consider doing so before the new tax structure takes effect at the end of 2025.
Imported antique vehicles
Imported vintage cars will be subject to a 45% excise tax and restricted to road use on Saturdays, Sundays, and public holidays only.
The 2026 automobile excise tax structure indicates a policy shift towards updated mobility standards. Vehicle prices are expected to vary depending on the new tax framework.
