As the retail industry pushes forward to recovery, the Philippines has the chance to catch up with its neighbors as a shopping destination in Asia or even in the world, according to Secretary Frederick Go, special assistant to the President for investment and economic affairs.
But Go said to do this, the government should implement electronic visas (e-visas) and give value-added tax (VAT) refund to tourists.
“We’ve always had that potential to be the shopping capital in Asia and even the world. But we need the e-visas to make it easier for travelers to come to the Philippines. We also need to have the VAT refund for tourists because practically every country in Asia has VAT refund for tourists.
If we indeed want to become a shopping capital, we need to have those two. These are very basic, very fundamental to becoming a shopping capital,” Go told reporters on the sidelines of the opening of the National Retailers Conference and Exhibit in Pasay City yesterday.
He said those measures will boost the tourism industry a low-hanging fruit that can stimulate economic activity. On the retail part, Go said these measures will attract more luxury players which will bring in global shoppers.
While countries like Thailand has gone ahead in becoming a shopping destination, Go believes it is not too late for the Philippines.
Roberto Claudio, president of the Philippine Retailers Association (PRA), in the same event expressed optimism over the continued resilience of retail.
“The signs of the recovery and growth are all around us now. The government is listening to the concerns of the retailers, and the omnichannel approach is thriving like never before.
This is a vital moment for the Philippine retail,” Claudio said.
Claudio said PRA is in engaged in regular consultations with key government agencies such as the , Department of Trade and Industry, Department of Finance,
Intellectual Property Office, Bureau of Internal Revenue, Department of Tourism, Food and Drug Administration, and others, in ensuring the voice of retail is heard on any legislation, any memorandum, any directive.
The PRA has been pushing for measures that would even the level of playing field between brick and mortar stores and online or electronic commerce particularly on taxes.
Claudio said the measure imposing VAT on online transactions is on its way for the signature of the president.
The PRA has also asked the Bureau of Customs to consider a proposal to remove the de minimis rule where online shipments of a a certain value need not pass customs, or any government regulatory function.
“ In other words, any online transaction that comes in has to be subjected to (customs) not just on taxes and duties but also to address counterfeit and fake goods online.
Claudio said the future is online but it will not kill brick and mortar stores.
“Brick and mortar needs to coexist with online. But until such time that the playing field is level,
we feel that online is still our competitors. They’re trying to get businesses from us brick and mortar, and we are also on our way to online. There is not going to be any retail apocalypse,” Claudio said.
Retail accounts for 18.6 percent of the country’s GDP, with an average tax contribution of almost P750 billion annually from 2018 to 2023.
Retail is the top sector in terms of employment in the Philippines, providing livelihoods directly for 5 million Filipinos.
