The Finance Ministry will push tax breaks for tourism spending in secondary provinces with a cap of 15,000 baht next year.

Most tourism-related operators in secondary provinces do not register under the value-added tax system and cannot issue tax invoices.

The Revenue Department will let individual taxpayers use receipts issued by registered operators to claim a tax refund, said Finance Minister Apisak Tantivorawong.

Travelling expenses and accommodation in secondary provinces, which are less popular than major tourist spots, will be eligible for the tax deduction, he said.

The government is pushing efforts to stimulate rural economies towards broad-based growth. Despite solid economic growth of 3.8% for the nine months to September and healthy exports, rural areas are still left behind.

The government is pinning hopes on tourism to help distribute income to people living in local communities and narrow social disparity.

Mr Apisak said the Tourism and Sports Ministry will decide which provinces will enjoy the tax break.

The Finance Ministry in September rejected the Tourism Authority of Thailand (TAT) tax deduction proposal, saying that only operators in large provinces would benefit from the tax privilege and that they were already enjoying robust tourism.

Under the TAT proposal, tourists who spend during the designated period will be allowed to claim a personal income tax deduction of 10,000-50,000 baht, depending on the area visited.

If they travel and spend money in flood-hit areas such as Sakon Nakhon province, they will be entitled to a tax deduction of 50,000 baht, five times higher than for top destinations like Phuket and Chiang Mai.

TAT governor Yutthasak Supasorn has said there are 61 secondary provinces, which are defined as destinations with an average of up to 4 million tourists a year, both foreigners and Thais.

News Reporter

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