Travel tax up for abolition

The rationale for the imposition of a travel tax (introduced in 1977) – that foreign travel is a ‘privilege’ – no longer reflects current conditions, prompting Senator Mark Villar to propose its abolition under Senate Bill 1870 – Travel Tax Abolition Act.

Sen. Mark Villar said, “Hindi dapat maging dagdag na pasanin ang pag-alis ng bansa, lalo na para sa mga Pilipinong bumibiyahe upang magtrabaho, mag-aral, magpagamot, magnegosyo, o makasama ang kanilang pamilya. Panahon nang alisin ang travel tax at ibalik sa ating mga kababayan ang perang maaari nilang magamit sa mas mahalagang pangangailangan.”

Presidential Decree 1183 of 1977 imposed the travel tax at a time when overseas travel was widely viewed as a privilege.

Villar said this “archaic” policy no longer reflects present realities, as Filipino travelers currently pay a full travel tax of P1,620 for economy-class passage and P2,700 for first-class passage. A family of four traveling in economy class must therefore spend an additional P6,480 before leaving the country.

“The amount of P6,480 is a big deal to a family. They can use this for food, transportation, rentals, medicine or other expenses when they travel. Amid the steady rise in prices of goods, it’s only right that we remove taxes that pose additional burdens and don’t reflect current realities,” Villar said.

Under SB 1870, government agencies and private entities will be prohibited from collecting travel tax once the measure takes effect. Passengers who already paid the tax for flights scheduled on or after the law’s effectivity will also be entitled to an immediate refund.

The proposal likewise supports the objectives of the Asean Tourism Agreement, which seeks to facilitate travel and promote stronger connectivity among Asean member states.

Allaying concerns of possible disruptions to government programs, Senator Villar noted that the bill has safeguards for the continued funding through the annual General Appropriations Act for projects previously supported by travel tax collections.

At present, 50% of collections goes to the Tourism Infrastructure and Enterprise Zone Authority for tourism development, 40% to the Commission on Higher Education for tourism-related educational programs, and 10% to the National Commission for Culture and the Arts.

“We will continue to support tourism education and culture, but the funds should not come from additional burdens on traveling Filipinos. These are national programs that must be funded out of the national budget,” Villar stressed.

“Our objective is simple: reduce the costs, make travel easier at bigyan ng mas malaking Kalayaan – the freedom to seek opportunity in any part of the world,” he added.