Philippines Moves To Abolish 50-Year-Old Travel Tax And Cut Cost For Filipino Travellers

(MENAFN- Khaleej Times) Here's good news for Filipino travelers: The Philippine government has proposed the abolition of travel tax, noting that“many Filipinos travel not only for leisure but also for work and emergency reasons.”

Palace press officer Claire Castro said Philippine President Ferdinand 'Bongbong' Marcos Jr. has included this week the proposal of removing travel tax among the 21 priority legislative measures approved by the administration.

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Travel tax is separate from the airport terminal fee collected from Filipinos traveling abroad. The charge is P1,620 (Dh102.50) per person for economy-class passengers and P2,700 (Dh170) for business and first-class passengers.

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This means, a family of four, on economy class, who will go on a holiday, will have to pay P6,480 (Dh410) on top of the airport terminal fee – which is now P950 (Dh60) per person. That's a total of P10,280 (Dh650) that must be paid before they can depart from the Philippines.

Travel tax, however, is not collected from departing overseas Filipino workers (OFWs), students on government scholarships, and infants.

Castro said the purpose of removing travel tax is to“ease the financial burden on travelers.

Tax origin

Incidentally, travel tax in the Philippines was first imposed almost 50 years ago, way back in 1977, during the time of Bongbong Marcos' father, former president Ferdinand Marcos Sr. It was implemented to manage the outflow of foreign currency and to fund tourism-related projects.

At the time it was introduced, international travel was mainly enjoyed by the social and economic elite. The fee then served as a 'luxury tax, with the proceeds intended to fund tourism-related projects via the Tourism Infrastructure and Enterprise Zone Authority (TIEZA).

Castro noted that currently 50 per cent of the travel tax goes to TIEZA projects, 40 per cent to government educational assistance and scholarships, and 10 per cent to promote culture and heritage. She added if the travel tax is fully abolished, the government will get funds from the national budget, noting details on revenue impact would be tackled once the bill is formally crafted.

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