Call for new instant VAT refund scheme

The Thai Retailers Association (TRA) wants the government to introduce an instant VAT refund scheme for tourists and set up a free-trade-zone sandbox in tourist destinations such as Phuket, with the aim of positioning Thailand as an Asean shopping hub.

- KUAKUL MORNKUM

Nath Vongphanich, president of the TRA, said the Thai retail industry faces numerous challenges, as reflected in the ongoing decline of the Retail Business Confidence Index.

This trend signals a drop in consumer spending, a slowdown in tourism growth, and an export sector constrained by tariff barriers.

Citing a report by Kasikorn Research Center (K-Research), the Thai retail sector is projected to see average growth of 3.4% in 2024-2025, dropping from 5.9% growth recorded in 2022-2023, he added.

To stimulate spending and attract more visitors, the association proposed an instant tax refund scheme, offering a 7% VAT refund to tourists.

To further incentivise spending, Mr Nath suggested that the refund threshold be set above the average spending levels, encouraging tourists to spend more to qualify for the refund, an approach they believe will benefit the retail sector.