THE Philippine Retailers Association (PRA) said the signing into law of the value-added tax (VAT) refund scheme for non-resident tourists will raise the Philippines’ competitiveness as a visitor market.
“We welcome the signing of the VAT Refund Scheme for Tourists. This should make us competitive in the tourism market considering we are the only Asian country not offering VAT refunds for tourists,” PRA President Roberto S. Claudio said in a statement on Monday.
He said the measure will result in improved visitor arrivals and spending.
“We would like to thank the President for recognizing this incentive to make the Philippines competitive in the tourism market, to make the retail industry more robust, and to make the Philippines a shopping destination,” he added.
President Ferdinand R. Marcos, Jr. on Monday signed into law Republic Act No. 12079, which allows tourists to claim VAT refunds on purchases worth at least P3,000 from government-accredited stores.
Previously, the House Committee on Ways and Means projected the VAT refund program to increase tourist expenditure by 29.8%.
Inbound tourist spending on shopping hit P137.4 billion last year, which is expected to be further elevated through the VAT refund scheme, the Department of Tourism (DoT) said in a statement.
“From handcrafted souvenirs to premium brands, the program will encourage tourists to invest in our unique offerings,” Tourism Secretary Ma. Esperanza Christina G. Frasco said.
“It will directly benefit micro, small and medium enterprises, create jobs, and drive economic growth,” she added.
In a separate statement, Secretary Frederick D. Go, the President’s special assistant for investment, said the VAT refund scheme is a response to a clamor from tourism organizations.
“This initiative aligns with global best practices, as many countries already offer such, making it a strategic move for the Philippines to enhance its appeal to international visitors,” according to Mr. Go, who heads the Office of the Special Assistant to the President for Investment and Economic Affairs.
“By encouraging substantial spending from tourists, we aim to drive economic growth and create more opportunities for our people,” he added.
The DoT welcomed 5.35 million visitors as of Dec. 1, up 9.53%, but far below the 7.7 million target set for 2024. — Justine Irish D. Tabile
