The Finance Ministry has scrapped a plan to hand out travel allowances in cash worth 1,500 baht each to about 10 million people for travelling in any of 55 second-tier provinces, part of a scheme to promote domestic tourism in areas not regularly visited be them.
The ministry pulled the plug on the scheme following criticism the money could be better spent on other projects.
It would have required a budget of 15 billion baht, and sourcing the money has reportedly proved troublesome.
It has since shifted its focus to extending the period during which domestic tourists can claim tax deductions on their travel expenses, and raised the cap for this from 15,000 baht to 20,000 baht per person, sources at the ministry said.
Initially, the ministry wanted to use the central budget to fund the scheme, but it was later found not to match the criteria that must be met for the money to be dispersed, they said.
The central budget is supposed to be reserved for use as a contingency fund to handle emergencies like natural and other disasters.
The government has taken flak for relying on populist policies, with the cash handout plan for tourists seen to be included in this bracket.
Critics say the regime is adopting such methods to shore up support for the pro-military Palang Pracharat Party, which is trying to form a coalition government in the wake of the March 24 general election.
Its chief rival is seen as the Pheu Thai camp, affiliated with ousted former prime minister Thaksin Shinawatra.
However, Prime Minister Prayut Chan-o-cha brushed aside such criticism, saying the original proposal was aimed at boosting the economy and had yet to be finalised before it was axed.
He said the export sector has been hit by the US-China trade war, meaning that economic growth should be spurred by encouraging consumers to spend more money at home in Thailand.
The 1,500-baht handout plan was one of many stimulus measures being considered to prop up the faltering economy, the sources said.
Gen Prayut was reportedly angered by the leaked news as the handout plan had not yet been approved by the cabinet before it was scrapped.
Another option being mulled was to give state welfare card holders an additional 500 baht for every child, the sources added.