The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) has cut its forecast for 2020 GDP growth to 2-2.5% from a previous projection of 2.5-3%, citing economic difficulties aggravated by the novel coronavirus outbreak.
The panel's export view remains unchanged between flat and a 2% drop, while inflation is seen at 0.8-1.5%.
This is the first downgrade by the JSCCIB. The previous forecast was made in January.
Supant Mongkolsuthree, chairman of the Federation of Thai Industries, said the virus epidemic is the latest risk putting pressure on the Thai economy.
"It hits the country's tourism, export and logistics industries, which are key engines to drive Thai GDP," he said.
The JSCCIB expects a prolonged coronavirus crisis of more than three months, with the tourism sector losing roughly 108 billion baht.
"If Thailand endures the virus for six months, the loss will total 220 billion baht," Mr Supant said.
For the export sector, the loss is estimated at 44 billion baht this year because of restricted transport from Thailand to China.
He said Thailand is already dealing with PM2.5 pollution, a strong baht and a delayed fiscal 2020 budget.
"Those risks mean lower overall confidence in investment and purchasing power," said Mr Supant.
"The JSCCIB has a more negative outlook for Thai GDP, but some members of the panel disagreed with the downgrade."
Kalin Sarasin, chairman of the Thai Chamber of Commerce, said Chinese tourists represent 28% of the 38-39 million foreign visitors annually, and their numbers are declining during the outbreak.
"The panel agrees with the government launching measures such as cash coupons for foreign visitors in this period to stimulate the tourism sector," he said.
"The government should launch measures to support Thai exporters, also suffering from the coronavirus outbreak, such as providing new shipment markets to replace China, where the government has shut down cities and precincts."
Thai exports to China account for 12% of total export value, or US$29.2 billion. Major export products include plastic beads, rubber, food and processed products, fruit and chemicals.
Thai imports of Chinese products, including machinery, home appliances and chemicals, account for 20% of total import value, or $50.3 billion.
Mr Kalin said the government should speed up investment projects and pass the fiscal 2020 budget bill because both factors would help spare the country's economy from the worst-case scenario.