Manila: Government officials signed on Monday the implementing rules and regulations (IRR) of Republic Act (RA) 12079 or the Value-Added Tax (VAT) Refund for Non-Resident Tourists. In a statement, the Department of Finance (DOF) said the IRR was signed by Secretary Ralph Recto, Bureau of Customs Commissioner Bienvenido Rubio, and Bureau of Internal Revenue Deputy Commissioner Marissa Cabreros. It was witnessed by Department of Tourism Secretary Christina Garcia-Frasco and Office of the Special Assistant to the President for Investment and Economic Affairs Secretary Frederick Go.
According to Philippines News Agency, RA 12079 aims to boost tourism and encourage more foreign tourists to shop and spend more in the Philippines, thereby bolstering economic growth. Under the IRR, non-resident tourists or foreign passport holders may apply for a VAT refund for locally purchased goods from accredited stores that are equivalent to at least PHP3,000. The goods must be physically taken out of the Philippines by the tourist as accompanied baggage within 60 days from the date of purchase.
The VAT refund applies only to retail and tangible goods, such as clothing, apparel, electronics, gadgets, jewelry, accessories, souvenirs, food or non-food consumables, and other goods intended for personal use. 'With a multiplier effect of 1.97, every 100 pesos spent by a tourist generates 197 pesos in economic output. Imagine that. Halos doble ang balik sa ekonomiya (The return to the economy is almost double),' Recto said.
Recto emphasized that more money spent by foreign tourists leads to more businesses created, more Filipino workers hired, more jobs provided, higher incomes for the people, and more revenues for the government. He highlighted the importance of effective implementation to unlock the law's full potential, stating the need for a fully functional VAT refund system and a surge in inbound tourism.
Heeding President Ferdinand R. Marcos Jr.'s call, Recto vowed to ensure that the VAT refund process is simple, accessible, and culturally inclusive. From the Department of Finance's perspective, the aim is to deliver a VAT refund system that is world-class, modern, and built on the principles of transparency, efficiency, and ease. The IRR mandates the DOF to engage the services of reputable and internationally recognized VAT refund operators to provide end-to-end solutions to the government. Such refunds may be made electronically or in cash to enhance the ease of doing business.
Recto concluded by expressing the shared goal of ensuring tourists leave the Philippines with more than just souvenirs, emphasizing that the country should deliver on its promises and provide systems and policies that work effectively for its guests.
