Finance Minister Outlines Fuel Excise Tax Policy to Promote Biofuels and Support Farmers

Key summary

On Monday, October 26, 2026, Finance Minister Ekniti Nitithanprapas presented the government's fuel excise tax policy at Government House. The policy aims to encourage a transition to biofuels, specifically E20 (ethanol blending) and B20 (palm oil blending), by creating a price difference between imported diesel and domestic biofuel blends. Minister Ekniti stated that tax relief benefits would flow directly to Thai farmers growing sugar cane, cassava, and oil palms. The government views reliance on foreign energy imports, particularly crude oil from the Middle East and natural gas, as unsustainable due to ongoing global conflicts and a large trade deficit. Consequently, the strategy emphasizes self-reliance using domestic agricultural products and supporting solar power to reduce natural gas imports for electricity generation. Regarding the Oil Fuel Fund's debt burden of more than THB100 billion and proposals for additional loans from the Ministry of Finance, the minister noted that coordination with the Ministry of Energy is required. He explained that excise tax cuts and spending from the fund are comparable to using a government's 'left pocket and right pocket,' as both actions increase the fiscal deficit and reduce revenue, necessitating more borrowing. The government now considers giving borrowed money directly to the public through targeted programs, such as solar power support, a more effective approach than general excise tax cuts.