Alliance of Concerned Teachers Rep. France Castro. (FILE PHOTO)
MANILA, Philippines — Instead of providing value-added tax (VAT) refunds for foreign tourists, the government should move to repeal regressive taxation policies, according to a lawmaker from the House of Representatives Makabayan bloc.
In a statement on Monday, Alliance of Concerned Teachers Rep. France Castro urged President Ferdinand Marcos Jr. to repeal the VAT and excise taxes on fuel products, pushing prices of basic commodities and transportation costs up.
Castro was referring to Marcos’ approval of the VAT Refund Program for foreign tourists in 2024 to attract tourist inflow into the country.
“While millions of Filipinos are suffering from high prices of basic goods and services, the Marcos administration prioritizes giving VAT refunds to foreign tourists,” Castro said.
“Prices of basic goods, especially food items, soared due to the increasing prices of fuel products, our government continues to refuse to do anything about these soaring prices of basic goods, which could start with repealing excise taxes and VAT on oil products,” she added.
READ: President Marcos okays VAT refund for foreign tourists
Castro further said that the government should prioritize Filipino workers and those who have lost their jobs and are struggling to make ends meet due to the high inflation rates.
“Inuna pa ang pagbibigay ng refund sa mga foreign tourists na kayang magbakasyon at magbayad ng VAT kaysa sa sarili nitong mamamayan na milyon-milyon na ang nagugutom, walang trabaho at naghihirap dahil sa taas ng mga bilihin at kakulangan sa disenteng pasweldo,” she said.
The Makabayan bloc and other progressive groups called for reducing or removing excise taxes on fuel products before. Last June and August 2022, the activist group Bagong Alyansang Makabayan (Bayan) reiterated their request for the Marcos administration to remove excise taxes on fuel products with inflation spiking.
READ: Bayan says VAT collection from oil products amid rising fuel prices ‘oppressive’
Last October, Makabayan filed bills seeking VAT exemption for basic goods, and then in November for the removal of VAT on utilities like electricity and water charges.
READ: House bill seeks VAT exemption for basic goods
“We in the Makabayan bloc filed several bills removing VAT on fuel and oil products, electricity system loss charges, tolls, water, all essential drugs and medicine, nutritional foods, and drinks. We also filed House Bill 568 Reversing Regressive and Anti-Poor taxation, repealing certain sections of RA 10963 or the TRAIN Act. These should be the priority of the Marcos Jr. administration that would give great relief to millions of Filipinos,” Castro said.
“The Marcos administration should prioritize the welfare of the Filipino people over foreign tourists. The Makabayan bloc also filed House Bill 258 or the Wealth tax, which can generate P469 billion that is more than what is collected from excise taxes and VAT from fuel products,” she added.
While the country has breached its tourism targets for 2022, with 2.65 million arrivals in the past year, the government — particularly the Department of Tourism — is looking for higher tourist arrivals for the coming years to stimulate the economy.
According to Tourism Secretary Christina Frasco, they target 4.8 million tourism arrivals from abroad in 2023.
READ: DOT breaches tourism target with 2.65M arrivals in 2022