A SENIOR congressman from Camarines Sur on Monday called on the Department of Finance (DOF) and the Department of Tourism (DOT) to hasten the crafting of a value-added tax (VAT) refund system for non-resident tourists to increase visitor arrivals and boost tourism revenues.
Although the new law-provided tax-free shopping privilege for non-resident foreign passport holders will translate into revenue losses, Camarines Sur Rep. Luis Raymund Villafuerte said the fiat would be offset by an estimated hike in earnings from tourism arising from significant rise in tourist arrivals and their subsequent local shopping expenses.
By replicating the tax-free policy for foreign visitors in such tourist-friendly economies as Japan and Singapore, the Philippines hopes to sharpen its competitiveness as a potential global shopping mecca, Villafuerte said.
“This is why I am optimistic that the DOF, the DOT, the Bureau of Internal Revenue and other concerned agencies will expedite the crafting of a VAT-refund system for the local purchases of non-resident tourists, as provided for in Republic Act 12079 that President Marcos signed last week,” he added.
Following consultations with the concerned agencies and other stakeholders, the Secretary of Finance is mandated by the law to release its implementing rules and regulations within 90 days of its effectivity.
The stakeholders that are to be consulted by the DOF in the crafting of the VAT-Refund System are the DOT, the BIR, the Department of Trade and Industry, the Department of Transportation, the National Economic and Development Authority, and the Bureau of Customs.
Internal Revenue Commissioner Romeo Lumagui Jr. had said the BIR will draw up the document with the DOF, then release the IRR in the first quarter of next year.
RA 12079 grants this tax-free privilege by amending the National Internal Revenue Code of 1997 to add Section 112-A establishing the VAT-refund system for non-resident foreign passport holders.
