Government Cancels Controversial 2024 Thailand Tourist Tax Plan
Prime Minister Srettha Thavisin announced the cancellation of the planned 300-baht tourism tax, a policy where every foreign tourist would be charged an entrance levy if they travel to the Kingdom by air. After fielding criticism and concerns from within and without, the government now believes that removing this fee will encourage tourists to spend more in other areas, boosting the economy.
A Defense against Over-Tourism
Thailand experienced a high volume of travelers after the COVID-19 pandemic, leading to overtourism. Phuket is a prime example, facing severe traffic jams, water shortages, and a lack of available airline slots at its international airport during peak seasons. Before the pandemic, Thailand faced over-tourism and had to close several popular beaches for long periods to protect their ecosystems from permanent damage.
In February 2023, the previous administration approved the tourist tax. A spokesperson for the Prime Minister’s Office stated at that time that the collected fees were meant for managing and developing tourism, and was confident that it would not harm business, as a fee like this has been instated in the past.
The original idea behind the 300-baht tax was to help manage the influx of tourists by funding projects to expand the country’s capacity to accommodate more visitors. It was also intended to fund infrastructure improvements in less-visited provinces to increase visitorship there and reduce congestion in other popular tourist spots.
The tourism tax would have increased the budget of Thailand’s Tourism Department, which currently receives 700 million THB each year. Officials believe this amount isn’t enough to support necessary development projects, so now they must seek funding elsewhere.
A Different Path to Improving the Economy
Thailand has been working to boost tourism in recent months to help its flagging economy, and opponents of the tax claimed that the tax would further hamper growth by discouraging tourism. The government seems to be laser-focused on increasing tourism at all costs, and has announced a raft of measures to increase the number of visitors to the Kingdom.
In May 2024, the government approved longer-duration visa solutions for tourists, postgraduate students, and remote workers, along with better visa conditions for retirees. For example, starting June 2024, travelers from 93 countries can stay for 60 days without a visa, up from the previous 57 nations, and more will be eligible for visas on arrival.
More Tax Cuts to Stimulate Growth
But that’s not the only way the government is trying to boost growth, as other taxes have also been cut recently, though not the ones most people had hoped for.
Thailand’s cabinet approved tax measures on 18 June to boost domestic tourism during the low season, Deputy Finance Minister Paopoom Rojanasakul announced. These measures, covering May to November, include tax deductions for companies organizing conventions and seminars in certain regions. Additional measures aim to increase travel to secondary cities by allowing income tax deductions for homestay and non-hotel accommodation expenses.
It is unclear if these measures will have a significant impact on growth in Thailand. At the same time, no additional funding or measures have been announced to combat the real threat of over-tourism. So it remains to be seen if the short-term gains from canceling the tourist tax will be worth the lack of investment in long-term solutions.
Category: About Thailand, Travel to Thailand
