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Tax update end of 2025
Corporate Income Tax Exemption for Large Commercial Electric Vehicles
On September 9, 2025, the Royal Gazette published Royal Decree No. 798, granting a corporate income tax (“CIT”) exemption for qualifying investments in large commercial electric vehicles made during the period from 27 March 2025 to 31 December 2025. The incentive is intended to promote investment and domestic manufacturing in the electric vehicle industry while supporting national efforts to reduce vehicle-related emissions.
Following the issuance of Royal Decree No. 798, Notification of the Director-General of Revenue on income (“DGN-IT”) No. 464 was issued on 26 December 2025 to clarify the rules, procedures, and conditions for claiming the CIT exemption under this Royal Decree.
Eligibility CIT Deduction Criteria
Corporate entities that invest in large electric vehicles are eligible for the CIT deduction, subject to the following conditions:
- For vehicles that are manufactured or assembled in Thailand, the company is entitled to an additional deduction equal to 100% of the purchase cost.
- For vehicles imported as completely built units from overseas, the company is entitled to an additional deduction equal to 50% of the purchase cost.
Qualifying Vehicle
- The vehicles must be for passengers or trucks shall be battery-powered and registered in accordance with the Motor Vehicle Law. The vehicles must never be used.
- The vehicles must be depreciable under Section 65 Bis (2) of the Thai Revenue Code (“TRC”) and must be acquired and ready for use on or before 31 December 2025.
- The vehicles must not be entitled to any other tax incentives in respect of the same asset under any other Royal Decree issued pursuant to the TRC, whether in whole or in part.
- The vehicles must not be used for the CIT exemption under Investment Promotion Act, National Competitiveness Enhancement for Targeted Industries Act, and Eastern Economic Corridor Act.
Required Documentation and Notification
A corporate entity seeking to claim the CIT incentive under this Royal Decree is required to:
- prepare an investment project, a financing plan, and detailed information relating to large commercial electric vehicles; and
- submit such information to the Director-General in accordance with the rules, procedures, and conditions prescribed under the Specified Ministerial Regulation.
Compliance and Revocation
Where a company fails to comply with the required documentation or notification requirements, or where the vehicles do not qualify in any accounting period, the CIT exemption will be revoked, and the previously exempted income must be included in taxable income for the relevant period.
However, an exception applies where the large electric vehicle is sold or becomes damaged, lost, or unusable. In these circumstances, the tax exemption is terminated from the accounting period in which the sale or damage occurs, and the company is not required to re-include the previously exempted income in taxable income again.
Pursuant to Clause 3 of DGN-IT No. 464, the exempted amount must be allocated evenly and claimed over five consecutive accounting periods, commencing from the accounting period in which the company begins depreciating the vehicles.
Further details are available at the following link:
https://www.rd.go.th/fileadmin/user_upload/kormor/newlaw/dc798.pdf
www.rd.go.th/fileadmin/user_upload/kormor/newlaw/dg464A.pdf
This update is for general guidance only and should not be relied upon for specific tax matters. Professional advice should be obtained for application to your particular circumstances.