Toyota fights $327m tax bill in Thailand

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Toyota fights $327m tax bill in Thailand

TAMAKI KYOZUKA, Nikkei staff writer


BANGKOK -- Toyota Motor said Thursday that it has gone to Thailand's Central Tax Court to dispute an order to pay more than 11 billion baht ($327 million) in additional tariffs and taxes.

The court is expected to begin hearing the case at the end of August. Such lawsuits could last two or three years, a local lawyer said.

Tax authorities told Toyota Motor Thailand in April that it owed additional taxes on Prius hybrid vehicles assembled at its Gateway factory between 2010 and 2012. The cars in question are thought to number more than 20,000.

The authorities also said the local unit had essentially imported the components need to build the Priuses, in the form of so-called knock-down kits, instead of procuring the parts locally. For customs purposes, knock-down kits are treated the same as finished vehicles and subject to a higher tariff rate.

Toyota is fighting the bill, arguing that it has government approval to manufacture Priuses in Thailand under the country's trade pact with Japan.

New-vehicle sales in Thailand dropped 26% on the year in April, falling for the 24th straight month as the economy stagnates. Toyota leads the market with a roughly 30% share. The Gateway plant in Chachoengsao Province, one of three Toyota factories in the country, has rolled out Priuses since November 2010.