Thai hotels warn of 20% ASEAN visitor drop, oppose travel tax

BANGKOK — Thailand’s hotel industry is warning of a weaker-than-expected high season, with visitors from ASEAN markets down about 20% amid lingering flood impacts, while opposing proposed travel taxes that could add thousands of baht to the cost of flying.

Thienprasith Chaiyapatranun, president of the Thai Hotels Association (THA), said tourism in the fourth quarter of 2026 was expected to remain broadly flat compared with the same period last year. Long-haul markets could perform better, while short-haul markets were likely to lag.

Advance bookings have been relatively encouraging for four- and five-star hotels, but lower-rated properties — which account for much of the country’s hotel supply — have yet to see a strong recovery. ASEAN visitors, who tend to be more sensitive to travel costs, have declined by around 20%.

Flooding in several areas has also undermined travel confidence, although conditions in major tourist destinations have improved. Domestic tourism by Thai travellers has slowed as households set aside money to repair flood-damaged homes and vehicles.

With the high season approaching, Thienprasith said it was probably too late to launch a major tourism stimulus campaign. He urged authorities to improve coordination among airports, immigration officials and baggage-handling services to prevent travellers from being stranded at airports during peak periods.

The association’s immediate concern is a proposed 450-baht tourism fee for foreign visitors arriving by air, alongside a separate proposed departure tax of 1,000 baht per trip that would apply to travellers of all nationalities.

Thienprasith warned that, combined with increased airport passenger service charges, these measures could push the total travel-related charges for foreign visitors to between 2,570 and 3,000 baht per person, making Thailand less competitive with destinations such as Vietnam and Hong Kong.

He said international visitors were already complaining that travel in Thailand was expensive. Additional charges could persuade them to choose other destinations. A decline in Thai outbound travel could also prompt airlines to reduce flight frequencies, potentially limiting air connections for foreign tourists and weakening what the industry calls “two-way tourism.”

The association also questioned the rationale for the proposed 450-baht tourism fee. The Ministry of Public Health has cited unpaid medical bills incurred by foreign nationals in Thailand, estimated at around 7 billion baht annually. However, Thienprasith said the three nationalities most frequently cited — Myanmar, Cambodian and Lao nationals — were largely migrant workers rather than short-term tourists.

He argued that migrant workers should generally be covered by the social security system and said the unpaid medical bill figures should not automatically be used to justify collecting tourism fees from foreign visitors. He also questioned a proposal to direct the estimated 8 billion to 10 billion baht in annual fee revenue to the public health sector, saying the government had yet to clearly explain how the money would be managed or what insurance coverage travellers would receive.

The Thai Hotels Association has formally written to the director-general of the Revenue Department opposing the principle of a proposed bill on departure taxes. The proposal, now undergoing public consultation, would impose a tax of 1,000 baht on each international air departure, with a proposed cap of 5,000 baht per trip.

In its submission, the association said the proposed tax could increase travel costs, suppress demand for air travel and undermine the competitiveness of Thailand’s tourism industry, affecting hotels, airlines, travel agencies, restaurants, retailers and local businesses.

The association estimated that foreign travellers could face combined charges of 2,570 baht per person per trip under the proposals. This calculation includes the 1,120-baht passenger service charge, which took effect on 20 June 2026, the proposed 450-baht tourism fee and the proposed 1,000-baht departure tax. The latter two charges are still under consideration and are not currently being collected together.

For a family of four, the additional charges could total 10,280 baht, excluding accommodation, domestic transport and other expenses. Local hotel-related fees in some areas could add to the cost.

The association also warned that lower demand for outbound travel by Thai residents could affect airlines’ route economics, leading to reduced flight frequencies or delays in launching new routes. This could leave foreign visitors with fewer flight options and higher fares, potentially diverting them to competing destinations.

It urged the Revenue Department and the Finance Ministry to reconsider or abandon the departure-tax bill in its current form. If the government decides to proceed, the association called for transparent studies of the likely effects on travellers, airlines, hotels and the wider economy, as well as consideration of alternatives that would not place unnecessary burdens on travellers.

The association said it supported effective and sustainable fiscal policies but stressed that any new tax should be assessed against its broader economic impact, including tourism demand, employment, business revenue and Thailand’s international competitiveness.