More than 20,000 small hotels can register as hospitality businesses if the government relaxes building rules that currently prevent them from registration.
A group of 10 tourism and hotel associations submitted a letter to the prime minister on June 29 asking for eased measures after some provincial governments started forcing unregistered hotels to close.
The government has not responded to the letter, but talks between state representatives and the private sector began in December last year.
Sanga Ruangwattanakul, president of the Khao San Road Business Association, said many small hotel operators were willing to register properly, but the current building requirements prevent them from doing so.
He said some properties were impossible to reconstruct or modify, such as old commercial buildings that do not have a fire escape route sized to meet registration requirements.
"We regularly pay income tax as well as land and building tax like other registered hotels, but are not able to obtain a hotel licence," said Mr Sanga.
According to the association, if the government relaxed the rules there would be at least 3,000 hotels with an average of 29 rooms in the Bangkok area eligible for hotel registration, while the nationwide number would be around 20,000.
The rules blocking small hotels from licensing include a mandatory size for stairways and corridors, which requires a width of 1.2-1.5 metres.
The group of associations said if the requirement for a five-storey building was fixed at 1 metre, and buildings greater than five storeys at 1.2 metres, then 80% of illegal hotels would be eligible for registration.
They are also calling for a loosening of requirements for disabled parking spaces, as most small hotels have limited land.
Moreover, some hotels are facing local environmental controls, such as Phuket's requirement for 30% of a business's total area to be kept empty. The group said roughly 80% of hotels would be able to register if this requirement was reduced to just 10%.
While the group is awaiting a response from the government regarding legal amendments, it urged local authorities to delay law enforcement until there are more appropriate rules that enable them to register under the Hotel Act.
Forced closures will not benefit the tourism industry, particularly as it recovers this year, when revenue has only just started to grow after two years of the debilitating pandemic, the group said in the letter.