New Thai govt cuts diesel taxes, waives visas for Chinese tourists to spur economy By Reuters

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New Thai govt cuts diesel taxes, waives visas for Chinese tourists to spur economy© Reuters. Thailand’s Prime Minister Srettha Thavisin speaks during a press conference after a weekly cabinet meeting at the government house in Bangkok, Thailand, September 13, 2023. REUTERS/Athit Perawongmetha

By Panarat Thepgumpanat and Kitiphong Thaichareon

BANGKOK (Reuters) – Thailand’s new government on Wednesday approved several measures aimed at boosting the economy, including a cut to the diesel tax, a visa-free entry programme for Chinese tourists and a suspension of debt payments for farmers.

Prime Minister Srettha Thavisin, who only came to power last month, inherits an underperforming economy struggling with weak demand for Thai exports and lower investor confidence after months of political turmoil.

The government will cut the diesel tax by 2.50 baht ($0.07) per litre, which will bring diesel prices below 30 baht a litre from Sept. 20 until the end of the year, and will also lower electricity bills, Srettha and officials told reporters.

The government will allow visa-free entry for visitors from China and Kazakhstan from Sept. 25 to the end of February.

“It’s a temporary waiver to see all the impacts,” Srettha said, adding he had discussed the matter with all sectors, including security to ensure they were prepared.

Chinese visitors accounted for about 28% of tourists to Thailand in pre-pandemic 2019. Srettha said there was increasing interest from people in Kazakhstan in visiting Thailand.

The government targets 28 million foreign tourist arrivals this year, with spending of 1.4 trillion baht ($39.2 billion), and 40 million visitors in 2024, said government spokesperson Chai Wacharonke.

“Tourism is the only economic engine at the moment that is still moving ahead and is a hope for generating income for the country,” he told a briefing.

In 2019, there was a record of 39.9 million foreign tourists, including 11 million from China. The government earlier said it aimed for five million Chinese tourists this year.

The government also approved a measure that will allow farmers and smaller businesses to suspend debt payments for three years.

Deputy Finance Minister Julapun Amornvivat told reporters the government would keep the value added tax at its current rate of 7% for a year.

The Thai Chamber of Commerce said on Wednesday the government measures would help the economy grow 3% this year. Last year’s growth was 2.6%.

Srettha said on Tuesday he aimed to introduce new policies as soon as possible, including hiking minimum wages.

($1 = 35.74 baht)

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