Transcript of the above video:

As the title of this video suggests, we are discussing foreign "Mafia Barons" in Thailand's Tourism sector. Let me get into this. I thought of making this video after reading a recent article from the Thai Examiner, that is thaiexaminer.com, the article is titled: "Zero-dollar tour cancer strangling Thailand's tourism economy and poisoning its reputation abroad. 

A couple of things here. First of all I don't know what China's deal is. I've done the video, 'Okay China' some time ago. We did another video when they were talking about they wanted to put Chinese Police down here on the streets of Thailand because ‘Chinese people’ didn't feel safe. This whole notion that it is ruining Thailand's reputation because a bunch of people are not really doing business in the most ethical way, out of any other jurisdiction, but it seems to be primarily focused on China which we will get into here in a moment. But why is that Thailand's problem? I'm tired of these issues of China and the Chinese being foisted back on Thailand like it is somehow Thailand's problem. If anything, in these zero dollar tours, the problem to Thailand is they are not getting their cut because they are not getting the taxes associated with the expensive resources and infrastructure here in this jurisdiction; that's the only issue to my mind with regard to zero-dollar tours. The notion that these people that are putting them on, sort of that it's Thailand's responsibility because there are bad actors in the marketplace and Thailand's reputation is going to suffer, well why would Thailand's reputation suffer because outsiders are exploiting Thailand? That is the most "bass ackward" reasoning I have ever heard.

That said, quoting directly: "Conflict over how much each incoming tourist spends with different data from Government Tourism Agencies and the Bank of Thailand in its reports. Quoting directly: "Thai Tourism Agencies claim it is between B45,000 and B50,000 per visitor, while Bank of Thailand data in its reports comes in at B33,903." So what they are talking about there is how much does each tourist spend? And the lowest number is 33,000 Baht which that is like a thousand bucks a tourist. That's not insignificant money. Quoting further: "Certainly, one explanation is the expansion of zero-dollar tours to unprecedented levels. These are tourism excursions sold to visitors in foreign countries, particularly in China, at deceptively low prices. In turn, the visitors arrive in Thailand and are subsequently coerced into spending money on ancillary products and services from specified sellers. In short, this is how the mafia groups organize the trade and subsequently make their money. And indeed they do. To such an extent that as tourism begins to pick up in Thailand, the practice has spread to Russian and Indian markets." And again they are noting it is rushing to those markets. This isn't happening within Thailand's jurisdiction; this is happening abroad before these tourists ever show up. Quoting further: "At length, in Phuket earlier this year there were reports of such tours being organized daily from Eastern Europe. However, the income earned is not by Thai firms or traders, it is the "Mafia Barons" who quickly launder it out of Thailand. Neither are taxes paid." 

Well no, that's not what's going on. I remember the original Zero-dollar tour. It is my understanding this remains. They are paid off-shore and then they just bring in the people without basically bringing their money with them. These people put their money into basically a repository offshore and then they come in. Now they may spend a little bit of money here on-shore and I don't know, maybe these fly-by-night outfits are collecting a little bit of money from the tourists once they get here and are "laundering" it out of Thailand, but let's be clear, I've discussed the banking issues here in Thailand now. It is not really easy to "launder" anything out of Thailand anymore especially large amounts of money. What is really going on here is these fees are being paid offshore and they are never really coming in to Thailand, that's the problem. Quoting further: "Minister of Tourism and Sports Sermsak Pongpanit set out in recent weeks to tackle the issue. However, industry bodies warn that massive action is required." Yeah it's going to require some enforcement here. Quoting further: "Certainly, Minister of Tourism and Sports Sermsak Pongpanit this week tackled the issue. Six agencies responded to the crisis. These included the Tourism Police, Immigration Bureau, Tourism Ministry, the Office of Permanent Secretary for Tourism, the Business Development Administration, and the Department of Special Investigation." That's kind of equivalent to like the Thai FBI. Quoting further: "Following this, 10 firms were closed immediately. It was reported that 30 firms in total were to be examined." So you could expect further closures down the road. Quoting further: "The status of 10 further firms is considered dubious and is being pursued." 

So again, those that are engaging in the "zero-dollar" stuff, Thai Law Enforcement takes it seriously. At the end of the day, the tax function of a given polity is usually the one that's prioritized the most, maybe with the exception of Defense. So again, this is something that is going to be heavily prioritized here in the Kingdom. Those who are operating these fly-by-night operations, it is probably a good idea to start rethinking that especially here in Thailand, as I think we are probably going to see more enforcement activity associated with closing down illicit tourism firms here in the Kingdom of Thailand.