Tax measures deserve our serious scrutiny and consideration, as they affect many aspects of our national life. Take travel taxes, for instance.
Recently, Cebu City South District Rep. Eduardo Rama filed House Bill 7367 to scrap the travel tax, calling it a burden on Filipinos. The bill, he says, aims to help families, students, senior citizens and overseas Filipino workers (OFWs) travel without extra fees.
By law, Filipinos traveling abroad need to pay a travel tax of at least P1,670. But this amount is unnecessary, Rama says, since Filipinos already pay income tax and value-added tax. The cost, he added, hinders those who are traveling for work, study, or for personal reasons.
Figures are incomplete as of this writing, but reports show that almost P8 billion worth of travel taxes were collected in the first half of last year alone.
Travel taxes support tourism projects, tourism-related college education and initiatives for culture and the arts. Pursuant to Section 73 of Republic Act 9593, 50 percent of travel tax proceeds shall accrue to the Tourism Infrastructure and Enterprise Zone Authority (Tieza), 40 percent to the Commission on Higher Education (Ched) and 10 percent to the National Commission for Culture and the Arts (NCCA).
Not surprisingly, public response on the proposed bill has been positive.
One of the reasons is a misunderstanding that no one is exempted from paying the travel tax. But the truth is that the following need not pay it: OFWs, balikbayans staying in the country for less than a year, infants under two years old, Muslim pilgrims traveling to Mecca, government officials on duty, diplomatic personnel, athletes participating in international competitions, accredited journalists, sponsored students and scholarship grantees.
Complaints have also been raised against the Tieza. Accordingly, many of its Tourist Rest Area projects which are aimed at providing “rest and recharge” stops for travelers have no Wi-Fi signals, are poorly-maintained and are mostly located in out-of-the-way routes.
Concerns have likewise been directed at the Ched which left travel taxes worth P10 billion unused for education subsidies these past years. Critics say that Ched needs to be more transparent on its spending, as the agency struggled to specify how their budget allocations were spent on tourism-related education initiatives.
Finally, to the 10 percent recipient of travel taxes, people say that the NCCA has been unable to fund culture and arts projects throughout the country. In Cebu, for instance, the agency’s presence has not been felt strongly despite the fact that travel tax collections are high here due to its status as a major tourist destination.
Still, scrapping the travel tax entirely will definitely affect the three agencies’ programs, limited or negatively-perceived as they may be. Surely, there must be a lot of other noble projects and activities under these agencies’ mandates that will suffer if they are deprived of travel tax funds. Besides, there will always be a room for improvements and reforms.
It might be wiser therefore if the proponent and supporters of the bill can identify alternative sources of funds for the Tieza, Ched and NCCA. While abolishing travel taxes may sound popular, there is really a need to find new sources of funding for these agencies when previous options are abandoned.