Cabinet okays low season stimulus
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Cabinet okays low season stimulus

Secondary cities to benefit from tourism

Tourists explore Wat Pho in Bangkok on April 25, 2024. (Photo: Apichart Jinakul)
Tourists explore Wat Pho in Bangkok on April 25, 2024. (Photo: Apichart Jinakul)

The cabinet on Tuesday approved measures to stimulate tourism in secondary cities during the low season.

Speaking after the cabinet meeting, Deputy Finance Minister Paopoom Rojanasakul said the measures were divided into two parts: companies holding seminars and individuals travelling for leisure.

Legal entities can deduct expenses from corporate income tax for seminar rooms, accommodation, transport, or other related costs for domestic seminars held for employees, or the service fees of tour operators for such seminars, held from May 1 to Nov 30, 2024.

The tax calculations include a double deduction for expenses related to seminars held in "secondary tourism provinces" or other tourist areas designated by the director-general of the Revenue Department.

A deduction of 1.5 times is allowed for expenses related to seminars held in non-secondary tourism or designated areas.

If a seminar takes place in both secondary and non-secondary cities consecutively, expenses that can be distinctly identified as occurring in each location should be separated. If they cannot be separated, a deduction of 1.5 times the actual expenses incurred is applied.

Individuals can deduct actual expenses paid to tour operators or for accommodation in hotels, Thai homestays, or non-hotel accommodation for travel in "secondary tourism provinces", up to 15,000 baht, from May 1 to Nov 30, 2024, deemed the low season, from their personal income tax calculations.

Both measures require a full tax invoice in accordance with Section 86/4 of the Revenue Code, in electronic form through the e-Tax Invoice and e-Receipt system.

These measures aim to stimulate tourism in secondary cities and increase travel during the low season, said Mr Paopoom.

He said such measures are estimated to cost the government up to 1.78 billion baht worth of tax revenue this year.


Chayabol Hirankanokkul, president of the Tourism Council of Phangnga, said the stimulus comes at the right time as room rates during the low season are more affordable for Thai tourists.

However, as Phangnga is not included in the secondary city list, he said it would automatically lose benefits from tax deduction measures for individual travellers, even though the province earns only 50 billion baht in tourism revenue per year.

Mr Chayabol said the government's selective approach, which focuses on stimulating second-tier cities, might not effectively help those provinces, particularly for meeting and seminar groups as facilities in those areas are not sufficient to host a large number of visitors.

La-iad Bungsrithong, a board advisor for the Thai Hotels Association, said promoting second-tier cities via a tax deduction might be inadequate to stimulate the overall tourism market, particularly the meetings, incentives, conventions and exhibitions segment.

Instead of focusing on secondary provinces, she said the government should push all state authorities to spend money on meetings anywhere within the limited time frame of fiscal 2024, which ends in four months.

Authorities should encourage large corporations to hold meetings in regional destinations as such companies have a budget and employees that can fill the market in the low season, said Ms La-iad.

In a separate development, the prime minister on Tuesday ordered the Finance Ministry to expedite the study of the entertainment complex project, including drafting the Entertainment Complex Act. Such complexes include the construction of casinos.

Government spokesman Chai Wacharonke said the project will have a significant impact on the economy, as the global business value of casino-based entertainment complexes in 2022 amounted to US$1.5 trillion, or around 54 trillion baht, with the figure expected to increase to $2.2 trillion, or 79 trillion baht, by 2028.

The territory with the largest casino-based entertainment complex business is Macau, which has a population of only 690,000, but generates revenue from this business of up to $32 billion. Second is Las Vegas with a value of $30 billion, while Singapore generates $12 billion.

For Thailand, having an entertainment complex will allow the government to collect taxes of at least 12 billion baht in the first year, Mr Chai said.

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