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The Thai government has announced additional incentives to promote sales of electric vehicles (EVs) in the country, as it wants to establish a global manufacturing hub for such vehicles.

Prime minister Prayut Chan-o-cha said the cabinet had approved an 80% cut in the annual road tax for privately owned, zero emission vehicles between October 2022 and September 2025.

The government has set a domestic sales target of 128,000 EVs in the three year period with the aim of attracting investments in the sector by foreign automakers.

The government also said it would waiver any import tariffs that apply to the local production of battery powered passenger cars, minibuses and pickup trucks until the end of May 2025. The tax exemption applies to the vehicles produced in the country’s tax free zones and free trade areas in industrial estates.

Prayut said: “Both these measures are part of the government’s initiatives to make Thailand one of the world’s major production bases for electric vehicles.”

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By GlobalData

Competition to attract EV sector investment in the region is rising, with Indonesia having announced this week that Toyota and Mitsubishi have both committed significant funds to invest in local production of electric and hybrid vehicles.