Massive Carbon Dioxide Emission Tax on Motorbikes Over 150cc Coming in 2020
In a recent article on October 28th, 2019 by The Nation Newspaper, the Director of Thailand’s Bureau of Tax Planning, Mr. Nutthakorn Utensute publicly stated that the Thai Cabinet has decided to raise taxes on new high powered motorcycles based on their actual carbon dioxide (CO2) emissions, instead of actual engine size, as originally proposed.
The hike in carbon dioxide (CO2) emission taxes comes into affect on or after January 1st, 2020 and is to be applied on all new motorbikes irrespective of whether or not they’ve been manufactured locally or imported from abroad.
This will mean that anyone who purchases a new motorbike in 2020 with a cubic centimeter capacity of 150cc or less can expect to pay an additional 100THB or more (depending on the level of carbon dioxide emitted) in the form of carbon dioxide (CO2) emission taxes, on top of any existing taxes which are already in place, bringing ones overall total tax liability up from 2.5% to 3% of the motorbikes retail or import price. Since motorbikes within this segment constitute more than 90% of the total number of motorcycles here in Thailand, and tend to be used by poorer people as their primary form of transportation, the Thai Government has made a conscious effort to minimize and shield this particular market segment from any significant tax increases, so caused as a result of the carbon dioxide (CO2) emission taxes.
Whereas on the opposite side of the spectrum anyone who wants to purchase a brand new motorbike in 2020 with a cubic capacity of 1,000cc or more, will be expected to pay an additional 100,000THB in carbon dioxide (CO2) emission taxes on top of any existing taxes which are already in place. The underlying rationale being that big bikes constitute less than 3% of the total number of motorbikes here in Thailand, and when coupled with the hefty price tags of big bikes, which are often more than 1 Million Thai Baht, (which is more than the average cost of a new family car) any one who chooses to purchase a big bike normally does so as a discretionary purchase, and as such have a tendency to be wealthier individuals who supposedly can afford to pay more in taxes.
Similarly if you plan on buying a new motorbike which is greater than 150cc, and less than 1,000cc in 2020 you can also expect to pay a disproportionally high amount of carbon dioxide (CO2) emission taxes, on top of any other existing taxes which are already in place, bringing ones overall potential total tax liability up to anything from 3% to 18% (depending on the level of carbon dioxide emitted) of the new motorbikes retail or import price.
The Director of the Thai Bureau of Tax Planning, then went on to caution motorcycle manufacturers that they could expect further tax increases of up to 700 Million THB per Year from the Excise Department if they don’t make any improvements to their carbon dioxide (CO2) emission standards, which will no doubt be beneficial for the environment.
So if you’re planning to purchase a new motorbike, you’d be well advised to do so sooner rather than later as it will be a lot easier on your wallet, as opposed to waiting until next year.