Toyota Prius to stop production until legal case resolved
Toyota Motor Thailand Co (TMT) will suspend production of the Prius autmobiles at their Chachoengsao factory for about a year or until the Central Tax Court hands down a final verdict on a tax dispute. Thai authorities claim there is no actual production line for the Prius at Toyota's Chachoengsao factory. Thailand is currently Toyota's largest Southeast Asian production base. Toyota began producing the Prius in Thailand in November 2010.
Thai authorities allege Toyota understated taxes by claiming the hybrid car is a completely knocked-down (CKD) vehicle despite the fact that the company imports most of the main finished parts from Japan for local assembly. The Nation Associate Anti-Corruption Network (NACN) early this year asked the Finance Ministry to investigate whether the hybrid is a CKD vehicle -- totally assembled in Thailand -- or an imported car, as the latter is subject to a 187.75% tax. The authorities then ordered Toyota to pay 11 billion baht in additional tariffs and taxes, applying a higher rate equal to that imposed on finished vehicles.