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“This is not a hotel” – Share economy exploits loopholes

The Thaiger & The Nation

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“This is not a hotel” – Share economy exploits loopholes | The Thaiger

by Nophakhun Limsamarnphun

Explosion in short term rentals causes problems for hotels and reduces tax revenues.

Legal loopholes and lax regulation of the hotel business have led to a large number of unlicensed hotel operators and unregistered guests in major tourist destinations in Thailand, according to government and private sector officials. In addition, the widely-popular sharing economy has prompted new generations of property owners, consumers and holidaymakers to use online and mobile platforms to rent out their units or to book holiday rentals and other forms of accommodation.

Supawan Tanomkieatipume, president of the Thai Hotels Association, said the ‘sharing’ economy could not be stopped, because more and more consumers preferred to use these platforms rather than continuing to use the services of traditional hotels. However, she said, many hotel operators have also adopted the new technology behind the sharing economy and various online platforms to accommodate consumer behaviour changes.

“We’re not discriminating against online sharing and other platforms but we hope all the parties concerned abide by the law,” said Supawan.

The government is supposed to ensure that accommodation owners register their guests properly and follow other regulations on safety, as well as forwarding their guests’ identities to immigration authorities, she said. In addition, they are required to pay local and other taxes as licensed hotel operators do.

So far, the government has been lax on enforcing these regulations while the number of condominium and other privately owned accommodation units serving tourists and other guests continues to skyrocket. At present, the Interior Ministry and local government agencies have jurisdiction over hotel and other rental accommodation operators.

Tourism and Sports Minister Weerasak Kowsurat says current Thai hotel law allows individual property owners a maximum of four rental rooms that can accommodate a maximum of 20 guests. They can operate like a hotel or other accommodation providers without having to register as operators.

This is seen as a legal loophole and has led to a fast-growing number of condo and apartment units being rented to tourists, especially in Bangkok and other popular tourist destinations, as online booking and sharing platforms experience phenomenal growth, including Airbnb, Booking.com and Agoda. Airbnb and Booking.com representatives could not be reached for comment.

Critics have said unregulated accommodation operators have contributed to the rise of visa overstayers and cross-border criminals using the country as a hiding outpost. According to Supawan, Thailand has about 300,000 to 400,000 licensed hotel rooms but the actual number of hotel rooms and other rentals being used is thought to be double those figures.

A huge but largely unknown number of hotels and other forms of accommodation are neither registered nor paying taxes properly, said Supawan. This has negatively affected law-abiding hoteliers due to the widespread unfair competition.

“We have reported this situation to the government which is losing a lot of tax revenues from these unregistered hotel and accommodation providers,” she said. Regarding Airbnb and similar private rental accommodation services, a court in Prachuap Khiri Khan province has ruled that renting out condo units to tourists is not legal.Udom Srimaha-chota, vice president of the THA and a hotel owner in the tourist resort of Hua Hin in Prachuap Khiri Khan, recently submitted a letter to the province’s governor, urging local authorities to take legal action against those turning their condo units and other private properties into daily tourist accommodation.

Udom said some condo projects in Hua Hin and other nearby resort towns were also allowing tourists to stay in their unsold rooms and charged them on a daily basis, in violation of the hotel business law. The unregulated service, says Udom, has led to safety, security and other problems for tourism and other authorities, since guests are not properly registered with local and immigration authorities. There is also no proper tax collection.

Many online and other advertisements promote condo units and apartment rooms as tourist accommodation in Hua Hin without having the proper licenses, Udom added. On the sharing economy, Weerasak said the fast-growing trend among tourists to use online platforms such as Airbnb for accommodation had multiple consequences. In his opinion, the sharing economy was supposed to enable people with surplus accommodation to rent it out but this was being widely abused.

“For example, you may rent out a room at your own house to guests but this has turned into a commercial activity for many people who buy or invest in multiple condo units and rent them out to tourists on a daily basis, just like hotels,” he said.

He admitted that there were legal loopholes in the Thai hotel business law, including an allowance for landlords to not need a hotel licence unless they had more than four rooms or guests exceeding a total of 20. In response to this trend, authorities have encouraged unlicensed operators to report their guests to authorities, but enforcement of this has not been strict.

Weerasak also noted that licensed hotel operators had faced unfair competition from these operators, who should be required to report the names of their guests to immigration officials as well as pay local government fees and taxes.

Furthermore, said Weerasak, there was also the matter of protecting other condominium residents, in particular the neighbours of units being rented out daily, whose quality of life was negatively |affected by the activities and behaviour of guests and tourists staying at the same building.

STORY: The Nation

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Thailand

Points deduction system for drivers to be introduced mid-December

The Thaiger

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Points deduction system for drivers to be introduced mid-December | The Thaiger

The point deduction system, for traffic and road infringements, is tentatively scheduled for activation for motorists and motorcyclists in mid-December. It is hoped that the system will help reduce road fatalities and injuries on Thai roads.

The deputy commander of Highways Police Command says that every licensed driver will be given an allocation of 12 points. Each time the driver commits a traffic law violation, points will be deducted. When there are no points left, the driver’s license will be suspended for 90 days, after which the driver or motorcyclist will have to undergo training administered by the Land Transport Department to get their licence back, and another 12 points.

Those who don’t attend the training, however, will have their licence returned after 90 days, but with only 8 points.

Points to be deducted differ, depending on the offence. Offences are divided into four categories:

• One point deduction

Using a cell-phone while driving; exceeding the speed limit; not wearing crash helmets for motorcyclists; not wearing seat belts; not giving way to emergency vehicles, riding on the sidewalk and not stopping for pedestrians on zebra crossings.

• Two points deduction

Running a red light; driving on the wrong side of the road; reckless driving; driving while his/her license is suspended and drunk driving.

• Three points deduction

Organising or promoting street racing without permission; hit-and run; driving while under the influence of narcotics; driving while under the influence of alcohol exceeding 150mg per ml.

• Four points deduction

Driving under the influence of alcohol exceeding 200mg per ml, drunk driving in a way which may cause serious injuries or death to the other people; driving in a manner disregarding the safety of the other people or causing trouble to other people.

SOURCE: Thai PBS World

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Economy

Opposition hits out at government’s military spending in 2020 budget

May Taylor

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Opposition hits out at government’s military spending in 2020 budget | The Thaiger

PHOTO: Reuters | The Business Times

The opposition is accusing the government of being more concerned with military arms than the daily struggles of Thai citizens. During a debate in Parliament on the budget bill, the government was accused of caring more about the growth in military spending than citizens’ financial woes.

The opposition levied the attack after PM General Prayut Chan-o-cha delivered the 3.2 trillion baht bill to the House of Representatives. The debate on the 2020 budget is expected to continue for two more days and if approved by Parliament, the bill will come into force early next year.

The PM says the budget aligns with the “20 year strategy” to improve the living standards of the nation’s citizens while growing the economy, but opponents accuse him of making defence spending a priority.

The leader of the opposition, Sompong Amornvivat, claims that in the five years the PM has been in power, total spending has hit 14.3 trillion baht, with loans of 2.2 trillion baht, without any significant growth in the economy. He accuses the government of spending more than 6 billion baht on defence, with the Interior Ministry getting 25 billion baht more than last year.

It’s also understood that the government has also put 518.8 billion baht aside, which it can spend as it wishes, without the consent of Parliament.

The government’s tourism stimulus plan, whereby domestic tourists would be given cash incentives, also came under fire as Sompong declared it a waste of money that would do nothing to boost productivity.

The subject of the PM’s oath-taking fiasco reared its head again, as the leader of the Seree Ruam Thai Party, Pol General Sereepisut Temiyavej declared the PM and his government unfit to rule or propose a budget bill as a result of it.

Anudit Nakorntab from the Pheu Thai party said the government should postpone unnecessary spending on military arms while the country’s citizens battle economic hardship, accusing the previous junta-led administration of also prioritising the military in its spending.

SOURCE: The Nation

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Environment

Academics warn of high cost of Thai ban on agri-chemicals

May Taylor

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Academics warn of high cost of Thai ban on agri-chemicals | The Thaiger

The chairman of the Thai Sugarcane Farmers Association, Thongkam Cheongklad, says a ban on the weed-killer paraquat would have a severe impact on production costs. Academics and Thai sugarcane farmers have also expressed their concern over the ban, saying it could cost the industry up to 570 billion baht.

The Nation reports that up to 1.2 million people working in the sugarcane industry are understood to be against the ban, saying the proposed paraquat substitute is both expensive and ineffective.

The president of the Thailand Society of Sugarcane Technologists, Kitti Choonhawong, says Thailand has approximately 11 million rai dedicated to sugarcane plantations, generating about 300 billion baht a year.

He claims that a ban on agri-chemicals may lower sugar production, which in turn would affect sugar factories and cause the export market to lose as much as 94.6 billion baht. Thailand is currently the world’s second biggest sugar exporter, behind Brazil.

A research director from the Thailand Development Institute says the ban could ultimately mean the country is not allowed to produce enough food, unless chemical fertilisers are still allowed if chemical pesticides are banned.

Viroj Na Ranong says production costs will still rise however, along with labour costs, adding that the government needs to do its homework.

“The government has to implement measures based on research, not on social trends and politics.”

It’s understood that The National Hazardous Substances Committee will meet on October 27 to decide if a ban on three chemicals currently used in farming will go ahead. The substances involved are paraquat, glyphosate and chlorpyrifos and the proposal is for them to be banned from December 1.

SOURCE: The Nation

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