• Tax deductions for accommodation and seminar expenses in 55 secondary cities from May 1 to November 30, 2024, will boost the domestic tourism market.
  • However, the impact may face challenges due to the tourism season and uncertain weather conditions, the readiness of the system, especially among small operators, and tourist behavior.
  • Kasikorn Research Center predicts that the number of domestic tourists in 2024 will reach 193.5 million trips, growing by 4.4% from the previous year, with revenue expected to be 870 billion baht, expanding by 7.8% from last year.

On June 4, 2024, the Cabinet approved tax measures to stimulate tourism in 55 secondary provinces, effective from May 1 to November 30, 2024, which include:

  1. Personal income tax deductions for accommodation expenses (hotels, homestays, and non-hotel accommodations) and tour services from travel in secondary tourist provinces, based on actual expenses but not exceeding 15,000 baht, requiring full tax invoices through the electronic tax invoice and electronic receipt system (e-Tax Invoice & e-Receipt).
  2. Corporate tax deductions for training and seminar expenses in secondary tourist areas can be deducted at twice the actual expenses, while primary cities can deduct at 1.5 times the actual expenses.
  • This measure is expected to encourage more Thai people to travel to secondary cities. Currently, 41% of Thai travelers are visiting secondary cities in the first four months of 2024, an increase compared to 2019. In several provinces, such as Chiang Rai, Suphan Buri, Samut Songkhram, Nakhon Phanom, and Ubon Ratchathani, the number of Thai tourists has already surpassed 2019 levels, and revenue from domestic tourism in secondary cities is also accelerating.

  • However, the positive effects of these measures may not significantly boost travel and revenue in the domestic tourism market. This is due to: 1. The measures mainly cover the rainy season, which has high weather uncertainty, and some national parks may close during this period; 2. Small accommodation and tour operators may not be ready to support the e-Tax Invoice & e-Receipt system; 3. Thai people's travel decisions during the measures may be less vibrant compared to earlier this year, which included long holidays and important festivals like Chinese New Year and Songkran; and 4. The choice of accommodation and seminar venues still primarily focuses on major tourist cities, with secondary cities often visited in a day trip format.

Kasikorn Research Center predicts that the number of Thai domestic travelers in 2024 will be approximately 193.5 million trips, representing a growth of 4.4% from the previous year (compared to a growth of 9.6% (YoY) in the first four months of this year. However, competition in domestic tourism remains high, as both public and private sectors in many provinces focus on developing tourism and organizing promotional activities, creating landmarks to provide diverse options for tourists. Therefore, tourism growth in each area will still vary.

For tourism revenue from Thai domestic travelers in 2024, it is expected to reach 870 billion baht, growing by 7.8% from the previous year (compared to a growth of 12.9% (YoY) in the first four months of this year. Although revenue from the domestic tourism market is continuously recovering, it remains below pre-COVID levels in 2019, as tourists have adjusted their spending behavior during trips, with the average length of stay decreasing to 2.1 days (from 2.46 days in 2019) and overnight stays accounting for a smaller proportion at 51% (down from about 57% in 2019).

[1] The 55 secondary provinces include Nakhon Si Thammarat, Udon Thani, Chiang Rai, Lop Buri, Phitsanulok, Suphan Buri, Ubon Ratchathani, Nakhon Nayok, Nong Khai, Sa Kaeo, Loei, Tak, Trat, Phetchabun, Chanthaburi, Mukdahan, Nakhon Sawan, Ratchaburi, Samut Songkhram, Buriram, Chaiyaphum, Phatthalung, Trang, Si Sa Ket, Prachin Buri, Satun, Chumphon, Sukhothai, Surin, Sakon Nakhon, Lamphun, Nakhon Phanom, Uttaradit, Ranong, Lampang, Roi Et, Mae Hong Son, Phichit, Phrae, Chainat, Nan, Ang Thong, Maha Sarakham, Kamphaeng Phet, Uthai Thani, Narathiwat, Yala, Phayao, Bueng Kan, Kalasin, Yasothon, Sing Buri, Nong Bua Lam Phu, Amnat Charoen, Pattani.