MANILA, Philippines – The Department of Tourism (DOT) expressed optimism that the newly implemented Value-Added Tax (VAT) Refund for Non-Resident Tourists law will significantly enhance the country’s tourism sector.
In her remarks after the ceremonial signing of the Implementing Rules and Regulations (IRR) for Republic Act. No. 12077 on Monday, March 24, at the Department of Finance (DOF) in Manila, Tourism Secretary Christina Garcia Frasco said that the initiative not only aims to make the Philippines a more “attractive shopping destination”, but also to stimulate economic growth by encouraging tourist spending.
“The signing of the VAT refund law by our President and the subsequent signing of the IRR therefore come at an opportune time for our country, where tourism spending is at an all-time high,” said Secretary Frasco, who served as a principal witness to the signing.
“According to the World Travel and Tourism Council, in comparison with our ASEAN neighbors, tourists that come to the Philippines spend the highest per capita at no less than USD 2,073. And we foresee that with the implementation of this VAT refund act, we would be able to inure more benefits for our local tourism stakeholders in the component of shopping tourism,” Frasco added.
Present during the ceremonial signing were representatives from key agencies and tourism stakeholders, including DOT Chief of Staff and Undersecretary Shahlimar Hofer Tamano; Duty Free Philippines Corporation (DFPC) Acting Chief Operating Officer Patrick Joel M. Cinco; Philippine Retirement Authority (PRA) General Manager and CEO Roberto “Bob” Zozobrado; Tourism Promotions Board (TPB) Chief Operating Officer Maria Margarita Montemayor Nograles; Department of Information and Communications Technology (DICT) Director Dennis Morales; and other government officials. (Photo courtesy of DOT)
The legislation was signed into law by President Ferdinand Marcos, Jr. in December 2024, establishing a VAT Refund System that enables non-resident tourists to reclaim VAT on local purchases amounting to at least PHP 3,000, the DOT explained.
According to the Tourism Department, to qualify for a tax refund, the purchased goods must be physically taken out of the country within 60 days of purchase.
Secretary Frasco also underscored the broader economic impact of the measure by saying that the foreseen “ripple effect” of the implementation of the law will be vast.
“In terms of the sectors that this will benefit from generated income from shopping, accommodations, transport, and other related services,” Frasco emphasized.
She also expressed gratitude to President Marcos for his “decisive action” in signing the VAT Refund Law and acknowledged the coordinated efforts of the different government agencies and the private sector.
“What the speed of the signing of the law and the signing of the IRR indicates is this, that under the administration of President Ferdinand R. Marcos Jr., this is a government that listens, that acts and that puts forth the welfare of the Filipino people first and foremost,” the Tourism Chief emphasized.
