PH now VAT-free for foreign tourists

OFFICIALS yesterday signed the implementing rules and regulations (IRR) for the VAT Refund for Non-Resident Tourists, which would allow foreign tourists to apply for a value-added tax refund for locally purchased goods from accredited stores.

Under Republic Act 12079, non-resident tourists or foreign passport holders can be granted a VAT refund for locally purchased goods, worth at least P3,000, which would be taken out of the country as accompanied baggage within 60 days from the date of purchase.

The IRR was signed by Finance Secretary Ralph Recto, Bureau of Customs commissioner Bienvenido Rubio, and Bureau of Internal Revenue deputy commissioner Marissa Cabreros.

The signing was witnessed by Tourism Secretary Christina Garcia-Frasco, and Office of the Special Assistant to the President for Investment and Economic Affairs Secretary Frederick Go.

“We want more tourists to come — and we want them to stay longer, spend bigger, and transact with convenience,” Recto said during the ceremonial signing.

Under the IRR, the Department of Finance (DOF) is mandated to tap the services of reputable and internationally recognized VAT refund operators to provide end-to-end solutions to the government. The refunds may be made electronically or in cash.

“With a multiplier effect of 1.97, every 100 pesos spent by a tourist generates P197 in economic output. Imagine that. Halos doble ang balik sa ekonomiya,” Recto said.

He added: “And more money spent by foreign tourists means more businesses created, more Filipino workers hired, more jobs provided, higher incomes for our people, and more revenues for the government to collect. That’s the simple formula for growth.”

The IRR comes after President Ferdinand “Bongbong” Marcos Jr. signed the measure into law last December, in a bid to stimulate more spending and promote the Philippines as a premier global shopping destination.

“Our shared goal should be clear: Tourists should leave the Philippines with more than just souvenirs. They should leave knowing that this is a country that delivers on its promises. A country that knows how to take good care of its guests. A country that doesn’t just welcome them with smiles—but with systems and policies that work,” Recto said.

“For if we do things right, in the eyes of our visitors, we won’t just be a country of pristine beaches and warm hospitality. We’ll be that one ultimate tourist destination they’ll keep coming back to. Again and again,” he added. (GMA Integrated News)