Phuket considers tripling hotel tax rate

Outgoing governor says 3% levy would bring in B1 billion a year for local development

PUBLISHED : 20 Jun 2026 at 12:00

UPDATED : 20 Jun 2026 at 12:41

Authorities in Phuket are considering a proposal to raise the provincial tax on hotels from 1% to 3% of room rates to generate additional revenue for local development and tourism promotion.

The proposal was raised on Friday during a workshop on tourism management amid the global energy crisis.

The law already allows provinces to collect local development taxes from hotels at rates of up to 3%, outgoing governor Nirat Pongsitthithavorn told the gathering.

Neighbouring Phangnga province charges a hotel tax rate of 2%. Taxes are usually included in the quoted room rate.

By increasing the Phuket tax rate from 1% to 3%, the Provincial Administrative Organisation (PAO) would earn about 1 billion baht a year, and by taxing other unregistered hotels as well, the revenue could jump to 1.5 billion baht, Mr Nirat said.

Phuket’s main income comes from the service sector, including hotels, tourism and restaurants. The sector is also the province’s biggest employer, so it is appropriate that the tax rate be proportionate to the important role tourism plays in the economy, the governor said.

The PAO spends some of the revenue from the tax on international roadshows to promote tourism to the island. Collecting a tax of up to 3% would allow for more marketing activities to help attract 14 million tourists a year, compared with about 11 million last year, he said.

Many unregistered hotels dodge paying tax but for legally registered hotels the regulations stipulate a local improvement fee of 1-3%.

“As for the remaining 80% of hotels not currently registered, how can we bring them into the system? If they don’t encroach on public land or beaches, they must apply for the correct permits,” said Mr Nirat.

“Even unregistered hotels would still have to pay maintenance taxes to the Phuket PAO.”

The province will have the Revenue Department follow up on the matter, ensuring all taxes are paid simultaneously, he said, adding that this could be achieved without having to amend any laws.

“If we received development funds from hotels of 4-5 billion baht per year, we could develop Phuket. It’s about showing love for Phuket by helping to pay taxes to support Phuket’s sustainable development,” Mr Nirat said.

Mr Nirat and his deputies were ordered transferred earlier this week as a result of a feud that Interior Minister Anutin Charnvirakul said was impeding operations. However, he remains in the post pending the official publication of the transfer order in the Royal Gazette.

Phuket governor Nirat Pongsitthithavorn attends a workshop on tourism management amid the global energy crisis, held in the island province on Friday. (Photo: Achadthaya Chuenniran)