Move to levy carbon tax will not impact consumers, top excise official assures
Initiative expected to help Thailand meet goal of cutting greenhouse gas emissions
The Excise Department announced on Thursday that it had finished studying the collection of carbon tax in Thailand and started drafting the regulations, with focus on minimising the impact on consumers while supporting the government’s policy of reducing the country’s carbon emissions.
In the first two years, carbon tax would be tied to fuel prices that are already taxed by the department, and therefore would not increase the people’s financial burden, department director-general Ekniti Nitithanprapas said.
“For example, a litre of diesel is normally taxed at 6.44 baht. A part of this will be attributed as a price of carbon, which is calculated from the amount of carbon generated by one litre of the said fuel, in this case, at 0.0027 tonne,” he said.
Ekniti said the carbon tax would benefit industries that export to Europe products that use large amounts of fuel in the manufacturing, such as iron. Exporters can use carbon tax levied in Thailand to subtract the amount they have to pay upon entering the EU territory.
“The carbon tax will help bring Thailand to international standards in carbon emission policies, and contribute to the government’s goal of reducing greenhouse gas emissions by 30 to 40% in the next six years,” he said.
On the carbon reduction front, Ekniti said the department has been promoting the manufacturing and usage of electric vehicles (EVs) in Thailand by reducing excise tax from 8% to 2%.
To qualify for this tax benefit, EV-makers must establish a production facility in Thailand and manufacture vehicles to offset the imported units.
The measures have attracted several foreign companies to shift their production bases to Thailand and invest in automotive and battery manufacturing with a combined value of over 80 billion baht, said Ekniti.
The director-general added that the department was also revising the structure of battery tax, which is currently levying a flat rate of 8%, regardless of types and grades of battery.
“The new structure aims to promote the manufacture of highly efficient, eco-friendly, and recyclable batteries to reduce environmental impact and support the growing use of renewable energy,” he said.
