BANGKOK, Thailand (AP)- Thailand's Cabinet has approved a tax break for automobile manufacturers who make small, environmentally friendly ''eco-cars,'' Deputy Prime Minister Kosit Panpiemras said Tuesday.
Thai manufacturers have yet to produce eco-cars, but the government wants to promote the cars and become a production center for them in the future.
The current 30 percent excise tax levied on small-to-medium size passenger cars with engine sizes of up to 2,000 cubic centimeters will be lowered to 17 percent for manufacturers of eco-cars with a planned annual output from the fifth year onward of 100,000 cars or more, Kosit said.
The tax incentive will take effect from October 2009, giving automakers time to set up their plants for eco-car production, Kosit said.
The Board of Investment - a state agency that promotes strategic foreign and domestic investment - will release full details of tax breaks and other privileges slated for eco-car producers on June 15, he said.
The eco-car category refers to gasoline-fueled vehicles with engines no larger than 1,300 cc and diesel-fueled vehicles with engines no larger than 1,400 cc that are fuel-efficient and generate low emissions, Kosit said.
Under the preliminary guidelines, eco-cars must consume no more than one liter of fuel for every 20 kilometers and meet international emissions standards.