A VALUE-ADDED TAX (VAT) refund scheme for tourists will help the Philippines hit its visitor arrivals goal and establish the country as a shopping destination, Department of Tourism (DoT) Secretary Ma. Esperanza Christina G. Frasco said.
On the sidelines of the Metro Manila Business Conference on Wednesday, Ms. Frasco told reporters that the department has supported the measure since the beginning.
“We are glad that this has passed through the lens of the House of Representatives. My understanding is that it is now pending in committee at the Senate. We look forward to its passage into law because the Philippines has much to offer in terms of shopping tourism,” Ms. Frasco said.
“Retailers… are able to offer very competitive pricing as well as quality products. And so we’re looking forward to the passage of the VAT refund scheme to be able to increase our tourism in the Philippines as a very attractive destination for shopping tourism,” she added.
The Philippine Retailers Association has expressed support for the incentives for foreign shoppers proposed in Senate Bill No. 2415, currently pending in the Senate.
The bill aims to provide non-resident tourists with VAT refunds for purchases worth at least P3,000 to encourage more visitor spending.
A counterpart bill to the Senate measure was approved by the House on March 6, 2023.
According to Ms. Frasco, the Philippines has received over 3.8 million international arrivals as of Aug. 21, equivalent to 47.8% of the department’s target for this year.
“We recognize that there are headwinds that continue to pose challenges in terms of arrivals, especially when it comes to our visa policies, and so we are grateful to our President for prioritizing the implementation of the electronic visa system, which we hope to see very soon,” she said.
The target “is achievable, although we are very pragmatic in terms of dealing with the present challenges as far as accessibility and other factors are concerned,” she added.
Ms. Frasco said plans are underway to improve the visitor experience for recreational divers with the Philippines being recognized as a top dive destination.
“We have since increased the number of dive destinations to 120 sites, meaning that there are many opportunities to dive across our islands,” she said.
“It is important to prioritize diver safety; that is why we are going to add five more hyperbaric chambers in addition to the 15 operational chambers in the country,” she added.
The new hyperbaric chambers will be put in place in Cebu, Puerto Galera, Boracay, Palawan, and Negros Oriental.
“As for our target markets, diving is very popular among our South Korean and European tourists. And so the effort really is to expand to these markets as well as to open up new markets,” she said.
BUDGET INCREASE
At a budget hearing on Tuesday, several legislators expressed support for increasing the budget of the DoT from the P3.39 billion it was allocated in the National Expenditure Program (NEP) 2025.
“We are also most grateful for their call to increase the budget of tourism, especially recognizing that it contributes 8.6% to our gross domestic product and employs 6.21 million Filipinos. So, we are hoping and praying for the increase of the DoT budget through our legislators,” Ms. Frasco said.
The DoT had originally proposed a budget of P13.4 billion for 2025, much larger than what the Department of Budget and Management approved for the NEP.
Additional funds will go toward enhancing a broad range of destinations, Ms. Frasco said, with a focus on infrastructure like rest areas and first aid facilities for visitors. — Justine Irish D. Tabile
