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No more duty-free on arrival at Thai airports

Duty-free on arrival at Phuket Airport - PHOTO: Flickr/Peter Robertson

Thailand’s international airports are to lose their duty-free on arrival concessions, as the government aims to boost domestic spending in local shops. In Phuket there are a few duty-free shops in the baggage collection area at the international terminal.

On Tuesday, July 2, the Cabinet confirmed duty-free on arrival shops are to be closed at Phuket, Suvarnabhumi, Don Mueang, Chiang Mai, Hat Yai, U Tapao, Koh Samui and Krabi airports.

Officials hope the move will result in an increase in domestic spending, generating up to 350 billion baht a year. Data from the Customs Office shows that last year, 3 duty-free operators at Thailand’s 8 international airports generated over 3 billion baht in revenue.

Nation Thailand reports that the closures are part of a government plan to promote Thailand as a shopping hub, in a bid to stimulate the sluggish economy.

Deputy spokesperson Rudklao Suwankiri says the move was initially proposed by the Finance Ministry without the need for legal amendments as all 3 duty-free operators agreed to close their shops in the Arrivals area of international airports.

According to a study from the Finance Ministry, the move is expected to result in:

  • Foreign tourist spending: Increase in local shops by an average of 570 baht per trip
  • Thai tourist spending: Switch to purchasing duty-free items from the country of origin
  • Domestic businesses: Duty-free operators will lose revenue, but the extra 3.46 billion baht generated per year will boost overall production, investment, and employment
  • Public sector: Higher tax revenue, especially income tax and VAT, due to circulation of funds to more businesses
  • Economy: Expected to boost Thai GDP by 0.012% annually

SOURCE: Nation Thailand

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