Travel agents urge controls on foreign booking websites
The Association of Thai Travel Agents (ATTA) is asking the government to supervise online travel bookings more closely after finding unfair competition between Thai and foreign companies.
Today there is only one Thai online travel agent, while the rest are international.
"We're doubtful about tax payments by international online travel agents, many of which have bookings for illegal or unregistered hotels on their websites," said ATTA vice-president Surawat Akaraworamat. "The government should be alert about this issue."
Competition is fierce in online travel reservations. Agents are pressuring hoteliers to give them the lowest room rates, said Pipakorn Lumwanna, director of sales at Sawadee.com, Thailand's sole online travel agent.
Some websites sell five-star rooms at three-star prices. This forces operators of small hotels to cut room prices further, affecting the overall rate structure.
Foreign websites have spent millions of baht on internet-based advertising. A big online agent from China recently made inroads into Thailand, charging a lower commission than the typical 15-25%.
Mr Pipakorn said the government should look at the trail of money and tax payments at foreign travel websites, whose revenue goes directly to parent companies and overseas banks.
Only room charges are transferred to hotels in Thailand, after the commission fee is deducted.
"We once planned to launch our website in China and found that the country required money generated from such transactions to be transferred to China and Chinese banks," Mr Pipakorn said. "I had to scrap the plan because the regulations there made it difficult, almost impossible to transfer money out of China."
Both Sawadee.com and ATTA want the Thai government to take action to strengthen Thai operators and control the online reservation business. At present, 80%-90% of Thai free independent travellers book hotel rooms online.
Agoda.com, one of Asia's leading hotel booking websites, was fined more than NT$20 million by the National Taxation Bureau of Taipei for not legally registering as a business in Taiwan and failing to issue unified invoices.
Apart from tracking business registrations and tax payments, the government could impose fair commission rates for online travel agents, ATTA suggested.
Many hoteliers are unwilling to pay high commissions to online agents.
"Thailand should seriously control online business to protect the country's benefit as Taiwan did," Mr Surawat said. "Many big online travel agents from Europe and China have been entering Thailand. The authorities must have a plan to deal with them."
Last week, ATTA met representatives from Taiwan's government and committed to boosting tourism between the two countries.
Under the collaboration, Taiwan will waive visa fees for Thai travellers who buy tour packages from 11 specified Thai travel agents.