Travel Tax Abolition Act

TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES ) First Regular Session 26 FEB 19 A9:22 SENATE 1870 RECEIVED B) S. No. _ Introduced by Senator MARK A. VILLAR AN ACT ABOLISHING THE TRAVEL TAX EXPLANATORY NOTE In 1977, Presidential Decree No. 1183, was promulgated imposing travel tax on all individuals leaving the Philippines, regardless of where their airline ticket was purchased. Pursuant to Republic Act No. 9593, also known as the Tourism Act of 2009, the distribution of the collected funds shall be as follows: fifty percent (50%) is allocated to the Tourism Infrastructure and Enterprise Zone Authority, forty percent (40%) to the Commission on Higher Education, and ten percent (10%) to the National Commission for Culture and the Arts. On November 4, 2002, the Philippines signed the ASEAN Tourism Agreement, which seeks to promote regional integration and facilitate easier travel among ASEAN Member States. A key provision of the Agreement mandates the removal of travel levies and taxes imposed on citizens of ASEAN countries. Despite this commitment, the Philippines continues to impose travel taxes on its citizens departing for international destinations, including those within ASEAN. This ongoing practice raises concerns regarding the country's full compliance with its obligations under the Agreement. Beyond the issue of agreement compliance, the continued imposition of travel taxes places an additional financial burden on Filipino travelers. These taxes increase the cost of international travel, affecting not only tourists but also individuals pursuing educational opportunities, employment, business engagements, or family visits

abroad. Such financial barriers run counter to the Agreement's objective of enhancing mobility and strengthening regional connectivity. Not to mention the fact that this unduly impedes one's constitutional right to travel. In light of these considerations, a review of the current travel tax policy may be necessary to ensure alignment with ASEAN commitments and to better support the mobility and welfare of Filipino citizens. Thus, this bill seeks to abolish the travel tax on the Filipinos leaving the country regardless of the purpose and provides for the alternative funding source for the agencies that will be affected by this Act, to ensure the continuity of their programs and projects. In view of the foregoing, approval of this bill is earnestly sought. MARK A. VILLAR

5012 • Oiler of tip e TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES ) First Regular Session FEB 19 A9:22 SENATE RECEIVED BY 1870 S. No. — Introduced by Senator MARK A. VILLAR AN ACT ABOLISHING THE TRAVEL TAX Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

Section 1. Short Title. - This Act shall be known as the "Travel Tax Abolition

2 Act".

Sec. 2. Repeal. - The State hereby abolishes the travel tax as imposed under

4 Presidential Decree No. 1183, as amended, and Section 73 of Republic Act No. 9593, 5 otherwise known as the "Tourism Act of 2009". All laws, decrees, executive orders, 6 rules, and regulations inconsistent with the provisions of this Act are hereby repealed 7 or modified accordingly.

Sec. 3. Prohibition and Refund.- No government agency or private entity shall

9 collect travel taxes upon the effectivity of this Act. For flights scheduled on or after the 10 date of effectivity, the collecting authority shall immediately refund any previously paid travel taxes to the passenger.

Sec. 4. Budget and Alternative Funding.- To ensure the continuity if programs

previously funded by travel tax collections, the national government shall provide the necessary funding for the following agencies through the annual General Appropriations Act (GAA): 1. The Tourism Infrastructure and Enterprises Zone Authority (TIEZA) tourism development projects: 2. The Commission of Higher Education (CHED) for tourism-related higher education development funds; and

3. The National Commission for Culture and the Arts (NCCA) for the National Endowment Fund for Culture and the Arts.

Sec. 5. Implementing Rules and Regulations. - Within sixty (60) days from the

approval of this Act, the TIEZA, in coordination with the Department of Budget and Management (DBM), shall promulgate the rules and regulations necessary for the efficient implementation of the tax refund and the transition to GAA-based funding.

Sec 6. Separability Clause. - Should any provision or part of this Act be declared

unconstitutional or invalid, the other provisions and parts hereof, insofar as they are separable from the invalid ones, shall remain in full force and effect.

Sec. 7. Repealing Clause. - All laws, decrees, executive orders, proclamations,

rules and regulations, or parts thereof, which are inconsistent with this Act are hereby repealed, amended, or modified accordingly.

Sec. 8. Effectivity. - This Act shall take effect fifteen (15) days after its

publication in the Official Gazette or in a newspaper of general circulation. Approved,