THE Thai-European Business Association has proposed to the government the possibility of providing an exemption on the import duty tax for test vehicles in order to encourage more foreign investment in automotive testing facilities in the Kingdom.
TEBA president Uli Kaiser and 12 other members of the association met with Industry Minister Atchaka Sibunruang and other representatives from the ministry and the Office of Industrial Economics yesterday.
They primary discussed six issues including accelerating the Asean Mutual Recognition Arrangement for automotive products to achieve a single regulatory regime.
Thailand signed on as a contracting party for the 1958 agreement but it has yet to be implemented.
It is hoped some of the following can be put under the one umbrella under the agreement to make it more well known: vehicle testing facilities; electric vehicles and quick-charging stations; automotive parts production for local content requirements; and the promotion of a dual education system in Thailand.
It’s also hoped a minimum-required manufacturing standard can be implemented under the Good Manufacturing Practice of Pharmaceutical Inspection Co-operation Scheme to enable contract manufacturing and greater penetration of the international export market and the legislating of tax breaks for pharmaceutical manufacturers.
Good exchange of dialogue
“We had a very good exchange of dialogue with Dr Atchaka and the OIE and we brought up the issues surrounding standardisation and the lowering of technical barriers to trade and market access,” he said.
He added that those factors were the key constraints for export growth in the automotive and auto-parts industry.
He said the association had proposed the import-duty exemption for test vehicles.
“The Minister has told us that the government is currently working exactly on the same thing [providing the tax incentives for foreign business] and we will have a follow-up meeting with the minister regarding this [the tax exemption for the import of test vehicles] and other issues that have been discussed today in the coming months,” he said.
“These testing facilities are necessary to keep Thailand as a top-level automotive hub as they are keys to attracting new investments in future technologies.
“Right now it is at an initial stage but if approved [the tax exemption] we can expect more automotive testing facilities in Thailand within the next one to two years.”
Areas of discussion
Uli said key areas of discussion to encourage the greater use of electric vehicles and related investments included providing tax incentives when purchasing EVs, alleviating the battery ownership risk and providing non-financial incentives.
He said the talks also touched on encouraging utility-rate discounts, using plug-in vehicle for transitional government fleets, encouraging the use of plug-in cabs and reducing the tax on green technologies.
Providing incentives for investments in charging infrastructure was also discussed, he said.
“EVs are already available in the market, but there is a lack of proper charging infrastructure,” Uli said.
“A shorter charging time will greatly aid user acceptance and encourage the EV market and improve technologies on quick-charging stations while further research with imported test cars is required.
“Waiving the tax on these imported test cars would greatly ease the challenges.”