HOMEGROWN souvenir retailer Island Souvenirs Inc. is optimistic about the recently enacted value-added tax (VAT) refund law’s potential to boost the Philippines’ tourism sector and support local industries.
However, its success will rely heavily on effective implementation, inclusivity and sustained promotion, according to Andrea Aldeguer, chief brand director of Islands Souvenirs.
She emphasized that a seamless and efficient refund process is essential to encourage tourists to take advantage of the benefit. Moreover, cumbersome or complex systems may deter participation, potentially undermining the program’s intended impact.
“By addressing these factors, the Philippines could not only boost its economy but also solidify its position as a go-to and top-of-mind destination,” Aldeguer said.
She highlighted how initiatives like this could enhance the country’s competitiveness, particularly in affordability and value for money. The Philippines currently faces stiff competition from Southeast Asian destinations like Bali, Bangkok and Hoi An, the latter recently named the cheapest travel destination by Condé Nast Traveler.
“This is a great opportunity for us to catch up,” she added, noting that the program benefits both visitors and
local businesses.
VAT refund for tourists
On Dec. 9, 2024, President Ferdinand R. Marcos Jr. signed the VAT Refund Program for Non-Resident Tourists Act, a landmark law aimed at boosting the country’s tourism appeal and fostering economic growth.
Under the law, tourists can claim VAT refunds for purchases of at least P3,000 per transaction made at accredited stores. Refunds must be processed within 60 days through electronic or cash mechanisms managed by experienced VAT refund operators.
The law also highlights local products, such as Marikina shoes, barongs, and handwoven textiles, showcasing Filipino craftsmanship on the global stage. This initiative is expected to encourage repeat visits and further strengthen the tourism sector.
“I am very optimistic that tourism will continue to thrive with the signing of this landmark legislation, which can add revenues to the economy and support retailers’ businesses,” said Tourism Secretary Christina Frasco in an earlier interview. She noted that shopping ranks as the second top expenditure for international tourists visiting the Philippines.
The country’s tourism sector already generated an estimated P712 billion in visitor receipts from Jan. 1 to Dec. 15, 2024, representing a 119 percent recovery rate compared to 2019 figures.
My Sinulog 2025
Island Souvenirs, a long-standing player in the Philippines’ tourism-retail industry, has been a consistent supporter of major tourism events like the Sinulog Festival.
Its signature “Cut & Style” activity, held annually during Sinulog, has consistently attracted crowds. Building on this success, Island Souvenirs expanded its personalization services last year to adapt to evolving consumer trends and preferences.
For Sinulog 2025, it launched its latest personalization concept, “My Islands,” which allows individuals to express their creativity by customizing various merchandise. These include tote bags, headdresses, t-shirts, pouches, tags and more. / KOC