Duty-free on arrival to be scrapped at Thai airports: Cabinet
The Cabinet on Tuesday confirmed that all duty-free shops in the arrivals areas of Thai airports will be closed to boost spending in domestic shops, aiming to generate up to 350 billion baht annually.
Three duty free operators generated 3.02 billion baht in revenue last year at Thailand’s eight international airports, according to the Customs Office.
The airports where duty free will be scrapped are Suvarnabhumi, Don Mueang, Chiang Mai, Phuket, Hat Yai, U-Tapao, Samui and Krabi.
Deputy government spokesperson Rudklao Suwankiri said the move would promote Thailand as a shopping hub and stimulate the economy.
The Finance Ministry proposed the change, which requires no legal amendments as all three operators agreed to close their duty-free shops.
A Finance Ministry study found the move would have the following four impacts:
- 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.
