House approves Marcos-backed VAT refund for tourists bill
The House of Representatives on Monday approved on third and final reading a bill granting Value Added Tax (VAT) refund for outbound tourists, a bill backed by President Ferdinand Marcos, Jr.
House Bill 7292 earned 304 "yes" votes, four "no" votes, and zero abstention.
Under the proposed measure, tourists will be eligible for a VAT refund on goods purchased from accredited retailers in the Philippines as long as such goods are taken out of the country within 60 days from the date of purchase and the value of goods purchased per transaction amounts to at least P3,000.
The bill also authorizes the Secretary of Finance to adjust the P3,000 threshold, taking into account the following indicators: administration costs in processing refunds; consumer price index; and other market conditions, upon the recommendation of the Secretary of Tourism and the Commissioner of Internal Revenue.
“This measure [is being passed] to adopt best practices in VAT refund schemes among Asia Pacific tourism destinations and expand the country's competitiveness among its peers and neighboring countries,” the committee report on the measure read.
The bill defines a "tourist" as a foreign passport holder who is a non-resident individual not engaged in trade or business in the Philippines.
House ways and means panel chairperson Representative Joey Salceda earlier said the measure will generate P10 billion to P40 billion worth of increased sales for local suppliers.
Salceda was one of the principal authors of the measure, alongside House ways and means panel vice chairperson Mikaela Suansing of Nueva Ecija who chaired the technical working group drafting amendments to the original proposed bill.
“Generally, for every P1 refunded, the tourist spends an additional 1.5 pesos. That will create an additional twenty to eighty thousand jobs, and will also improve our gross international reserves,” Salceda said.
The Value Added Tax (VAT) refund for outbound tourists was recommended to the Marcos by the Private Sector Advisory Council (PSAC), a group composed of business leaders and industry experts providing technical advice to the President in achieving the government's economic objectives in six key sectors namely agriculture, digital infrastructure, healthcare, infrastructure, jobs generation, and tourism. —VAL, GMA Integrated News