Proposed VAT refund for foreign tourists hurdles 2nd reading at House
MANILA, Philippines—The bill seeking to provide value-added tax refunds to foreign tourists has passed the House of Representatives on second reading.
The House on Wednesday (March 1) passed the bill by voice vote, or viva voce.
House Bill No. 7292 is the consolidated version of bills filed by Albay Rep. Joey Salceda, Nueva Ecija Rep. Mikaela Suansing, Agusan del Sur Rep. Alfelito Bascug and United Senior Citizens Rep. Milagros Aquino-Magsaysay.
The bill was recently approved by the House committee on ways and means which Salceda chairs.
The bill provides that foreign tourists who purchase goods worth P3,000 and above from accredited stores get VAT exemption, provided these items are brought out of the country 60 days after purchase.
Salceda said at a previous hearing that they expect the proposal to bolster the country’s economy, as it would attract more tourists as the Philippines is one of the few remaining countries without tax exemptions for non-resident tourists.
“I expect between P10 to 40 billion in increased sales from local suppliers,” Salceda said.
“That has the same nature, consequence, and character as exports. And we don’t even have to compete with other exporters. The audience is already captured,” he said.
“Save for India and Cambodia, we are the last major Asian country without an operative VAT refund system for tourists. That hurts our competitiveness for tourists with, say, Vietnam and Thailand, which now receive more tourists than we do,” he added.
READ: House panel OKs VAT refund bill for foreign tourists
The proposal to have VAT refunds for foreign tourists came after President Ferdinand Marcos Jr. supported the measure, pushing for its rollout by 2024 in a bid to attract more tourists.
READ: President Marcos okays VAT refund for foreign tourists
Such a move, however, was opposed by opposition lawmakers like Alliance of Concerned Teachers (ACT) Rep. France Castro who said that what the country needed is VAT exemption for basic goods as Filipinos are suffering from high prices of commodities like food and oil products.
READ: Lawmaker questions VAT refund for foreign tourists
READ: Makabayan solon: Repeal regressive tax policy, not VAT refunds for foreign tourists
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.