Tourism operators expect the domestic market will be flat or contract from last year unless the government launches an effective stimulus scheme to increase low-season trips, as Thai household income generation weakened last year.
Several institutions reported Thailand's average household income declined last year, while those with lower income relied on financial assistance, reflecting the vulnerability of household financial status.
Udom Srimahachota, vice-president of the Thai Hotels Association (THA), said domestic tourism in Hua Hin is worse than last year, especially among weekend visitors. This trend worries tourism operators as spending power is hampered by the energy crisis and the Middle East conflict, although this situation is expected to gradually ease after the US-Iran ceasefire.
Mr Udom said Thai tourists remain cautious in spending for travel, reducing their trips this year. He said this frugality could continue for 2-3 years, as there is no sign of a significant economic recovery or growth.
The property market remains sluggish, while households report increased expenses with unchanged or reduced income, noted Mr Udom.
The tourism and sports minister said earlier the government plans to roll out a new phase of the domestic co‑payment scheme in the fourth quarter, with a 3‑billion‑baht budget to offer 1 million privileges.
The THA urges the government to accelerate the launch of this scheme to the low season to help absorb costs for travellers and ease the impact on operators of fewer foreign arrivals, said Mr Udom.
July and August have public holidays, while there are school breaks in October, which can encourage people to plan trips. Hotels often have limited vacancies for Thai tourists in the fourth quarter, while prices are higher than in the low season as operators can gain higher yields from foreigners.
Surawat Akaraworamat, advisor for the Association of Domestic Travel (ADT), said domestic travel is expected to remain unchanged this year as people lack confidence about when the economy will recover.
According to the Tourism and Sports Ministry, Thailand recorded 120 million domestic trips in the first five months of 2026, up 1.9% year-on-year, generating 488 billion baht.
Mr Surawat said those with sufficient budgets are opting for overseas travel, which offers new attractions and promotional prices, and can sometimes be a comparable price to domestic trips.
Thailand's supply side also lacks upgrades, making it less attractive to Thai tourists, while lesser-known destinations are not sufficiently promoted, he noted.
"How much domestic tourism can grow will depend on the government's stimulus and marketing plans," said Mr Surawat. "The government should help promote new products, such as rail tourism or tourism on army properties, which have potential but are unknown among tourists."
The ADT hopes the government will include a subsidy for tour packages in the scheme, offering more options for travellers and alleviating the burden on tour operators, he said.
