Value-added tax exemption and duty-free privileges on purchases of tourists will spur spending and make the Philippines competitive with other tourist destinations.
“Shopping is an integral part of tourist experience. Apart from seeing sights, the next thing (tourists) do is shop. We want to encourage shopping; we want tourists to spend most of their dollars or euros in the Philippines by (having) duty free privilege extended to VAT to these visitors as well,” said Paul Santos, president of the Philippine Retailers Association.
Santos said these exemptions have had much success in other countries where they are given even in Southeast Asia like Singapore, Malaysia and Thailand as well as other parts of Asia like Hong Kong and Japan.
Santos said when the shopping privilege was eliminated in the United Kingdom, tourists end up not buying in London but instead shop in Paris where the VAT exemption is granted.
Santos said a framework should be in place to implement the refund scheme for tourists who can claim the amount at the airport.
In March, the House of Representatives approved on third and final reading House Bill No. 7292 that allowing nonresident tourists get a VAT refund on purchases of goods worth at least P3,000.
In January, President Ferdinand Marcos Jr. has approved a VAT refund program for foreign tourists by 2024.
