Bangkok The strategy of the Royal Thai government to introduce VAT Refund for Tourists Scheme for revival of tourist arrivals after a heavy blow to the economy due to loss of revenue following imposition of lockdowns and stringent Covid control measures, has paid off rich dividends.
Initiated by the Revenue Department and Tourism Authority of Thailand (TAT), the scheme not only helped in getting more tourists mainly from India, China, Europe and the USA, it also boosted the revenue realisation and increased employment opportunities for the local youth. Thailand depends heavily on tourism. It received almost 11.5 per cent of its GDP in 2019 from tourism. Foreign tourists’ arrival collapsed after international borders were sealed. Thailand government itself also enforced a strict policy to restrict the arrival of tourists.
The tourist arrivals are now limping back to normalcy with the hotels, restaurants, airlines, cabs and the entertainment industry like water sports and beachfront parties bouncing back to near normalcy.
VAT is given to only those items like gold, jewellery, laptops, smartphones, televisions and other luxury articles bought from stores and malls displaying ‘VAT refund for tourism’ signboards and banners within 60 days of buying. The claim has to be made at the airport at a special counter put up for refund after immigration. It is also given electronically by filling a prescribed form and claiming the amount along with the original invoice copy. For claims at the airport, the items bought have to be produced at the special counter. The purchase should be at least for a value of 5,000 baht including a single purchase with a minimum value of 2,000 baht. Claims above 30,000 baht are transferred to the credit card within 34 days. One baht, the currency of Thailand is equivalent to Rs 2.34.
In 2022, Thailand Revenue Department refunded an amount of 1.2 billion baht towards VAT to 4.23 lakh tourists. Officials expect the amount will see a significant jump in 2023 itself, during January-March, the authorities refunded 700 million baht to 2.73 lakh tourists – most of them from China and India.
“More than gold items, there is heavy demand for electronic gadgets and Bangkok malls sell a lot of latest models and appliances immediately after their launch and before their arrival to several countries. The process of refund is also very simple as the officials are tourist-friendly,” P Srinivas Kumar, a local travel operator, told Bizz Buzz on Sunday.
During a visit to Thailand, this correspondent saw heavy rush at Central Mall, Indra Mall and other areas to avail of benefits given under the refund scheme. Tourists availing the scheme get up to seven per cent VAT refund. Due to heavy arrival of tourists, many are opting for payment of 200 baht more to get a visa on arrival through fast-track mode in addition to the normal charge of 2,000.