The cabinet yesterday approved tax breaks for tourism spending in 55 provinces, a move aimed at spurring travel and distributing income to provinces dubbed "secondary".
The tax breaks, scheduled to be effective from Jan 1 to Dec 31, 2018, will be offered to individual travellers who spend on accommodation, food and drinks, as well as to corporations that organise seminars and meetings at these secondary locations, which welcome fewer than 4 million tourists a year.
Those who spend on accommodation, food and drinks at secondary locations in 2018 can use their receipts to claim a tax deduction of up to 15,000 baht, while companies can claim up to 100% of the cost of seminars and training sessions.
The government is estimated to lose 200 million baht in revenue from the tax breaks.
According to government spokesman Sansern Kaewkamnerd, the tax breaks are necessary because a Tourism Ministry survey found that 50% of tourists prefer travelling in the 22 main provinces, including places like Bangkok, Chiang Mai, Phuket, Surat Thani and Khon Kaen.
"Travellers will be allowed to use receipts instead of full tax invoices to claim the deduction, as most tourism operators in secondary provinces, including homestay and food outlets, make an income of less than 1.8 million baht a year," Mr Sansern said.
The tax-collecting agency requires all operators earning at least 1.8 million baht to register for the value-added tax system.
Tourism and Sports Minister Weerasak Kowsurat said the ministry will announce ministerial regulations to allow certain areas in major provinces that attract few tourist arrivals to be entitled to the same tax breaks.
Uthai Uthaisangsuk, chief operating officer of Sansiri Plc, the real estate and Escape Hotel operator, said the new tax breaks will encourage Thai people to travel more upcountry, especially to second-tier provinces, throughout 2018.
He said that while tourism prospects are expected to thrive in the coming year, the sector still needs some stimulus measures to ensure growth momentum.
"The country's overall economic prospects are promising next year," Mr Uthai said. "Exports and GDP are likely to see higher growth than earlier predicted. We expect tourism and related businesses to grow accordingly."
In a separate development, the cabinet yesterday approved "New Year gifts" offered by state banks in the form of measures to help debtors with good payment track records.
GH Bank will hand out 1,000 baht each to 165,107 small debtors with loans of up to 1 million baht. The cash handout will be offered to debtors who made timely payments for 24 months.
The Bank for Agriculture and Agricultural Cooperatives (BAAC) will offer a 30% discount on annual interest expenses, representing 2-3 percentage points, for debtors who make timely payments from Jan 1 to Dec 31, 2018.
The cabinet also approved a measure to enable low-income earners who now hold welfare cards to own their own home.
The government will let them request borrowing from GH Bank of up to 1 million baht with a fixed interest rate of 2.75% a year in the first four years.
Those who borrow more than 1 million baht and up to 2 billion baht will be offered a fixed interest rate of 3% over the four years.
State officials will also be allowed to borrow from the programme with no limitation on the loan amount and a fixed rate of MRR-3.75%.
