AFTER introducing a bill that seeks to abolish the travel tax imposed on Filipinos traveling abroad, House Deputy Speaker for the Visayas Pablo John Garcia has called on the public to support his legislation.
“I’d like to invite you to get involved. It will make our work so much easier if there’s pressure from the public, there’s support from the public for the passage of the abolition of the travel tax. Talk to your congressman, send an email, share, post on Facebook that you are in support of the bill,” Garcia said in an interview with SunStar Cebu on Friday, Aug. 30, 2019.
Cebu’s third district representative filed House Bill (HB) 3874 last Aug. 13.
Garcia said the travel tax under Republic Act 1478 of 1956 is an obsolete idea.
“Travel has become more and more of a necessity, not just a luxury. It’s not just the rich who are traveling. The increasing members of the middle class are also traveling outside the country maybe for leisure or for education, or simply to be exposed to ideas and developments abroad,” he said.
Taxing foreign travel is unreasonably burdensome on citizens and residents as the income from which they use to buy their tickets is already taxed, said Garcia.
The ticket sales are also taxed by the government. But airline firms do not shoulder the taxes—they pass the burden on to their customers.
The full travel tax is P1,620 for passengers on economy class plane tickets and P2,700 when flying first class, according to detourista.com.
As stated by Presidential Decree 1183, Filipinos have to pay the appropriate travel tax, regardless of the place where the airline ticket is issued or the form of payment.
If Garcia’s measure becomes a law, around 3.7 million passengers, based on the 2017 records, could benefit from it.
The lawmaker’s bill might face resistance from the Department of Finance as the removal of the travel tax would result in a loss of revenue for the government.
However, Garcia remains positive the measure would pass into law with the support of the public.
In 2017, the government collected P5.63 billion in travel taxes. Fifty percent of the revenue (P2.81 billion) was allocated to the Tourism Infrastructure and Enterprise Zone Authority (Tieza), 40 percent (P2.25 billion) went to the Commission on Higher Education (Ched), while 10 percent (P563 million) went to the National Commission for Culture and the Arts (NCCA).
“Tieza, which is the main recipient of the proceeds of the travel tax, has, sometime last year, issued a statement that they are willing to replace the travel tax with a fee—a departure fee of P500,” Garcia said.
HB 3874 states that the amounts needed for the programs that had been funded by the travel tax shall thereafter be charged to the respective appropriations of the Tieza, Ched and the NCCA under the General Appropriations Act. (WBS)