THE abolition of the travel tax was first proposed in late January this year by House Majority Leader Sandro Marcos, via House Bill 7443.
The Travel Tax Abolition Act of 2026 seeks to repeal the travel tax imposed under Presidential Decree 1183 and related provisions in the Tourism Act of 2009.
This month, Marikina City Rep. Miro Quimbo, chair of the House Committee on Ways and Means, described the proposed abolition of the travel tax as a “no-brainer,” arguing that while the government stands to lose an estimated ₱7.5 billion in direct revenues, the measure could generate as much as ₱22 billion annually in broader economic activity.
This framing shifts the debate from a narrow fiscal lens to a developmental one, highlighting how policy design can either constrain or catalyze growth.
The travel tax, imposed since the Marcos Sr. administration, was originally intended as a mechanism to fund tourism promotion and cultural exchange.
Over time, however, it has become a regressive levy that penalizes outbound Filipino travelers, particularly overseas workers and students.
In today’s globalized economy, where mobility is both a right and a necessity, the tax increasingly appears outdated.
Industry groups see the abolition as a way to stimulate demand, lower barriers to travel, and align the Philippines with regional peers that have long junked similar levies.
From a governance perspective, the projected ₱22 billion in additional income is not a direct replacement for the tax but rather an estimate of multiplier effects: increased airline traffic, higher tourism receipts, and expanded consumption linked to freer movement.
The challenge for policymakers is to ensure that these gains lead to improved tax administration, tourism infrastructure, and investment in services that benefit both travelers and local communities.
House Bill 7443 enjoys support not only from travel industry stakeholders but also from President Marcos Jr. himself, indicating executive legislative alignment.
This increases the likelihood of passage, but it also raises expectations that the government will deliver on the promised benefits.
Abolition, it must be emphasized, should be accompanied by reforms in airport competitiveness, visa facilitation, and tourism marketing.
Otherwise, the ₱22 billion projection risks becoming aspirational rather than actual.
Critics may claim the foregone ₱7.5 billion is not trivial, especially in a fiscal environment where the government faces mounting debt and infrastructure demands.
But a broader issue is whether the government clings to outdated revenue streams at the expense of competitiveness.
The travel tax functions like a tariff on mobility, dampening the very flows of people and capital that the Philippines needs to thrive.
Removing it is a structural reform that signals openness, much like trade liberalization did in earlier decades.
In the end, the question is not about whether the government can afford to lose ₱7.5 billion, but whether it can afford to miss out on ₱22 billion in potential gains.
The abolition of the travel tax represents a proactive growth strategy that, with complementary reforms, could mark a turning point in how the Philippines positions itself in the global tourism and labor mobility markets.
