The Federation Of Thai Industries has backed Honda Motor’s calls to suspend import duties until vehicle manufacturers affected by the floods are able to restore local production.
Local reports suggest the Thai cabinet has already agreed in principle to the temporary tax cuts and that the Ministry of Finance is currently preparing to implement the measures.
A large number of dealers are struggling with severe stock shortages at a time when significant order backlogs had build up in the wake of the devastating earthquake in Japan in March. Honda dealers in particular do not expect local production to restart for at least several months.
It is believed the government is ready to temporarily cut import duties on parts, raw materials, machinery and assembled vehicles.
It remains unclear how the government will target the tax cuts to those most in need although an across-the-board duty waver is unlikely.
The government is also looking into providing credit support for small and medium businesses affected by the floods.