Amending Pd No. 1183 (Travel Tax)

TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session 25 JUL -3 P4:30 SENATE RECE S. No. Introduced by Senator Raffy T. Tulfo AN ACT AMENDING PRESIDENTIAL DECREE NO. 1183, AS AMENDED, OTHERWISE KNOWN AS THE DECREE AMENDING AND CONSOLIDATING THE PROVISIONS ON TRAVEL TAX OF REPUBLIC ACT NO. 1478 AS AMENDED AND REPUBLIC ACT NO. 6141, PRESCRIBING THE MANNER OF COLLECTION THEREOF, PROVIDING PENALTIES FOR VIOLATIONS THEREOF, AND FOR OTHER PURPOSES EXPLANATORY NOTE The right to travel is a fundamental liberty expressly enshrined in Article III,

Section 6 of the 1987 Philippine Constitution. It provides that no law shall impair this

right, except in cases where national security, public safety, or public health so require. Notwithstanding this constitutional guarantee, the imposition of travel tax has, in effect, created an economic barrier that disproportionately affects ordinary Filipino citizens, thereby limiting the practical exercise of this right. Presidential Decree No. 1183, as amended, governs the imposition of travel tax on individuals departing from the Philippines, regardless of the place of issuance or mode of payment of the travel ticket. Pursuant to Section 73 of Republic Act No. 9593, the proceeds of said tax are distributed as follows: fifty percent (50%) to the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), forty percent (40%) to the Commission on Higher Education (CHED) for the advancement of tourism-related academic programs, and ten percent (10%) to the National Commission for Culture and the Arts (NCCA) to promote cultural preservation and development.

While the continued collection of travel tax contributes significantly to the development of tourism infrastructure, education, and cultural initiatives, it cannot be denied that the ordinary Filipino traveler, particularly those who travel on economy class, bears an undue financial burden. This is compounded by the already heavy tax obligations imposed on Filipino citizens, including income and consumption taxes. In recognition of these circumstances, this legislative measure seeks to exempt economy class passengers from the payment of travel tax. It is, however, emphasized that this bill does not seek to abolish the travel tax in its entirety. The measure merely introduces a more equitable structure by retaining the imposition of travel tax on passengers traveling via business class or higher, whose financial standing affords them greater capacity to contribute to national development. In this manner, the government shall continue to secure the necessary resources for TIEZA, CHED, and the NCCA, ensuring the sustainability of essential programs and projects, while alleviating the financial strain on the average Filipino traveler. In view of the foregoing, the immediate enactment of this proposed legislation is earnestly sought.

TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES First Regular Session 25 JUL -3 P4:30 SENATE S. No._ Introduced by Senator Raffy T. Tulfo AMENDING PRESIDENTTAL DECREE NO. 1183, AS AMENDED, OTHERWISE KNOWN AS THE DECREE AMENDING AND CONSOLIDATING THE PROVISIONS ON TRAVEL TAX OF REPUBLIC ACT NO. 1478 AS AMENDED AND REPUBLIC ACT NO. 6141, PRESCRIBING THE MANNER OF COLLECTION THEREOF, PROVIDING PENALTIES FOR VIOLATIONS THEREOF, AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

Section 1. Section 1 of Presidential Decree No. 1183, is hereby further amended

to read as follows: "Section 1. There is hereby imposed, in lieu of the travel taxes levied under Section three of Republic Act No. 1478, as amended, and Section six of Republic Act No. 6141, a Travel Tax from all citizens of the Philippines, permanent resident aliens and non-immigrant aliens who have stayed in the Philippines for a period of not less than one year. There shall be based on the fares on the trip from the Philippines and the trip returning or going to the Philippines as well as the fares paid in foreign country in continuation of the trip from the Philippines and the trip returning or going to the Philippines. The Secretary of Finance within sixty (60) days from the approval hereof, shall prepare the Schedule of Travel Tax for the approval of the President. The schedule of Travel Tax may be amended from time to time by the Secretary of Finance which amendment shall take effect upon approval by the President. The Travel tax under the Schedule shall not exceed the

equivalent of fifteen per cent (15%) of the fare involved but in no case shall the tax be less than two thousand pesos for those traveling under first class passage; one thousand two hundred and fifty pesos for those traveling under economy class BUSINESS CLASS passage and seven hundred and fifty pesos for all others; provided, however, That subject to the provisions of Sec. 2 (i) and (k) hereof, individuals who are twelve years old or below shall pay only fifty per cent of the tax imposed therein."

Sec. 2. Section 2 of Presidential Decree No. 1183, is hereby further amended

10 to read as follows: "Section 2. The following shall be exempt from the payment of the travel tax imposed under section one of this Decree - XXX" "(L) PASSENGERS TRAVELING UNDER ECONOMY CLASS PASSAGE."

Sec. 3. Separability Clause. - If any provision of this Act or the application

16 thereof to any persons or circumstances shall be held unconstitutional, the remainder of this Act and the application of such provisions to other persons and circumstances not otherwise affected shall remain in full force and effect.

Sec. 4. Repealing Clause. - All laws, decrees, proclamations, issuances, or

20 ordinances that are contrary to or inconsistent with the provisions of this Act are hereby amended, repealed or modified accordingly.

Sec. 5. Effectivity. - This Act shall take effect fifteen (15) days after its

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