Non-tariff Vehicles - Can Anyone List Them?

[pistonpilot]

My friend Marty says the Vios and the Honda City are made in Thailand and not subject to high tariffs. Are there others?

[chaiyapoon]

Its fairly easy,almost all the commonly seen models on the road are thai built.Import duties make others relative rare as the tax can mean 175% to be added to the price.Take a Mazda RX8 uk price 21k thai price 53k.

[Plus]

Thailand produces nearly 1 mil vehicles per year, most of them are not subjected to noticeably high tariffs. However all European makes are still expensive, for no apparent reason.

[indothai]

I think Honda Accords are also made in Thailand. At THB 1,648,000 it seems pretty high to me, for the top of the line model. Price I got from honda.co.th website. Convert that to USD and it's about USD $45,000.

I think I messed up somewhere in my math, cause something is not adding up.

[nikster]

I think Honda Accords are also made in Thailand. At THB 1,648,000 it seems pretty high to me, for the top of the line model. Price I got from honda.co.th website. Convert that to USD and it's about USD $45,000.

I think I messed up somewhere in my math, cause something is not adding up.

No you are not. I was trying to find any kind of list of excise tax rate but gave up now - if anyone can find an authorative page let me know.

The bottom line is that passenger cars and SUVs built in Thailand are taxed anywhere from 30 - 50%, plus the VAT of 10%.

Cars over 3000cc are subject to luxury tax, which can be 100% or more.

Imported cars are taxed at 80 - 200% depending on engine size etc. I didn't find any info on imports from ASEAN countries but it must be much lower.

Pick-ups built in Thailand are taxed at 3%. So that's why they are the best value vehicle you can buy. Don't know about vans but they seem pretty cheap so I think they must have low taxes similar to pick-ups. If they are not imported

Edited September 6, 2006 by nikster

[Tywais]

Here is a pdf file from the Ministry of Industry with a historical breakdown of the various excise taxes.

Automotive excise tax

Another interesting pdf file:

Summary of Thai Tax Law

And another:

Foreign Trade Barriers

Edited September 6, 2006 by tywais

[pistonpilot]

Can someone explain to me why in a poor country does the government tax the cars so much? If they levy a 50 percent tax on Thai built car, what is the sense in that?

[nikster]

Here is a pdf file from the Ministry of Industry with a historical breakdown of the various excise taxes.

Ok, now that's good information! Thanks for that, this is exactly what I had been looking for for a while.

So this shows that PPVs like Fortuner still have 20% Excise tax + 10% Municipal + 7% VAT.

And sedans (saloons) anywhere from 30 - 50%, depending on engine size.

These are excise taxes so they are for both imports and Thai-made cars. But for imports, import taxes are added, for example 80% for passenger cars (CBU).

I know that CBU means "completely built up" whereas CDK means completely knock down, the latter is presumably importing parts with local assembly and has a lot lower rates than CBU.

Here's the relevant page from the original document - just the tax rates. Rotate it clock-wise in Adobe Reader or print it out.

Thai_Automotive_Tariff_2005.pdf

[nikster]

Can someone explain to me why in a poor country does the government tax the cars so much? If they levy a 50 percent tax on Thai built car, what is the sense in that?

Here's my theory: These taxes were first introduced when no ordinary Thai could afford a car, when there was no middle class. The rich Thais would buy the cars regardless [this is still the case, witness the number of brand new BMWs and Mercedes in Bangkok which cost well over USD 100,000 in Thailand].

Now that there's a middle class, it makes much less sense. Nowadays the only reason is to keep Thailand the country where pick-ups are produced. That, and sqeezing the middle class for all it's worth which is typical of Thaksinomics.

[indothai]

Ridiculous high taxes. I guess it all goes both ways, as long as people are willing... government will keep on...

[Meerkat]

Some of the European makers seem to play along with the game here too. IIRC, some BMWs and Volvos (X5 and SC90?) are now being assembled domestically, but they're priced with a much higher margin than the imported ones. So it's cheaper to get one rather than importing, but they're still priced high because the (imported fully-built) competition is taxed so high.

Can't blame them, but a PITA.

[fxm88]

Can someone explain to me why in a poor country does the government tax the cars so much? If they levy a 50 percent tax on Thai built car, what is the sense in that?

The same reason that some other poor countries tax the heII out of mobile phones: revenue!

"Mobile phones and development, Calling an end to poverty", The Economist, Jul 7th 2005:

Mobile phones have become indispensable in the rich world. But they are even more useful in the developing world, where the availability of other forms of communication—roads, postal systems or fixed-line phones—is often limited... A recent study by London Business School found that, in a typical developing country, a rise of ten mobile phones per 100 people boosts GDP growth by 0.6 percentage points. Mobile phones are, in short, a classic example of technology that helps people help themselves.

...

Lower prices will make a second barrier ever more apparent: high taxes and duties imposed by many governments on handsets and services, often just as growth in the sector starts to take off. “It does seem strange for countries to say that telephone access is a public-policy goal, and then put special or punitive taxes on telecoms operators and users,” says Charles Kenny, an economist at the World Bank. “It's a case of sin taxes on a blessed product.”

Edited September 11, 2006 by fxm88