Thai hotels seek tax breaks for renovations and EV charger installs
Operators of Thai hotels are advocating for tax deductions or subsidies to support renovation investments, especially those focused on green energy initiatives. The Tourism Authority of Thailand (TAT) also urged hotels in second-tier cities to install electric vehicle (EV) chargers to cater to the increasing number of travellers using EVs.
The Thai Hotels Association (THA) is set to meet with the finance minister soon to request financial incentives aimed at boosting the competitiveness of licensed hotels in the country.
THA President Thienprasit Chaiyapatranun emphasised the need for financial stimulus, particularly to help mid-scale hotels that have been in operation for many years and are at a higher risk due to intense competition from illegal rooms converted from new condo units. Thienprasit stated that, unlike five-star accommodations, these hotels are struggling to keep up.
“Mid-scale hotels have not fully recovered from the pandemic and lack the necessary cash flow to invest in renovations.”
In 2020, the Finance Ministry introduced tax measures to mitigate the pandemic’s impact, allowing hotels to use 1.5 times the amount of expenses from building extensions or renovations as a tax deduction.
Thienprasit noted that this measure was instrumental in helping many hotels revive their businesses, enabling them to compete with upgraded facilities and pricing. He urged the ministry to consider this policy once again.
Helpful hand
“The ministry should consider adopting a similar scheme again, particularly for smaller-scale hotel operators.”
This would allow these establishments to repair and renovate their buildings, thereby enhancing the overall tourist experience in Thailand.
Deputy Governor for Domestic Marketing at TAT, Somradee Chitchong, added that including the installation of EV chargers in the tax deduction scheme would align with the agency’s plan to boost domestic trips by EV owners.
Somradee highlighted that more charging stations at hotels would make it easier for EV drivers to explore new destinations beyond the major provinces, addressing one of their primary concerns about finding charging stations.
“While domestic airfares remain relatively high, the EV market has been growing due to the government’s subsidy scheme, which provides up to 100,000 baht per vehicle purchase.”
Former THA president Marisa Sukosol Nunbhakdi also voiced concerns about the current land and building tax calculations and mentioned that the tax rate is based on the land appraisal value, which rises annually, while hotel revenues have been fluctuating since the pandemic. Marisa spoke on the struggles that many smaller-scale hotels face.
“Small and medium-sized hotels in prime locations such as Bangkok are struggling.
“They face intense price competition not just from direct rivals but also from condo owners who illegally list rooms for daily bookings.”
This combination of financial pressure and competitive challenges has led to a call for government intervention to support the hotel industry, ensuring that it can continue to attract tourists and contribute to Thailand’s economy, reported Bangkok Post.
