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23 Jan 2025

Thai Economy

Thailand to impose an initial carbon tax on oil and petroleum products, not affecting retail prices (Current Issue No.3549)

คะแนนเฉลี่ย
•    Thailand will levy a carbon tax on oil and petroleum products at the rate of THB 200 per ton of carbon dioxide equivalent (tCO2eq). The tax will be included in the existing oil tax and will not affect retail oil prices. This will result in oil users contributing to carbon tax payment at a rate of THB 0.069 - 0.623 per liter, based on types of fuels that emit varying amounts of carbon dioxide.

•    However, the carbon tax is not expected to burden consumers or increase costs for industries. The measure is a change in the internal structure of the excise tax that calculates the carbon price embedded in the oil tax. The focus is to raise public awareness and establish a carbon pricing mechanism. The carbon tax rate of THB 200 per tCO2eq is considered relatively low compared to other countries. For instance, Finland levies a carbon tax of USD 100 per tCO2eq (approximately THB 3,600), while Singapore’s rate is USD 18 per tCO2eq (approximately THB 648).

•    The carbon tax will be collected at varying rates based on the emission factors of oil and petroleum products, with the initial rate set at THB 200 per tCO2eq. This implementation marks the starting point preceding the Climate Change Act, which is expected to take effect in 2029. During the interim, adjustments to the tax rate and the range of products subject to the carbon tax may be introduced.

Thai Economy

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