Airline operators expressed support for removing the travel tax, noting that eliminating the tax would boost passenger demand and lower travel costs.
In a statement on Wednesday, the Air Carrier Association of the Philippines (ACAP) said the proposals to remove the travel tax will make international air travel more convenient.marginal forceSorted.
President Ferdinand R. Marcos, Jr. had urged Congress to abolish the travel tax by the time legislators adjourned in June.
According to ACAP, eliminating the travel tax will also increase the Philippines' connectivity and global competitiveness.
“ACAP member airlines are gearing up to expand their Philippine-based hub networks, thereby generating economic benefits across the tourism value chain,” it said.
ACAP is composed of flag carrier Philippine Airlines and its regional brand PAL Express, budget carrier Seibu Pacific and its regional brand Sebago, and AirAsia Philippines.
The Finance Department said last year that eliminating the travel tax could result in a revenue shortfall of up to P5.1 billion.
Travel tax was first imposed in 1956 through Republic Act No. 1478 and later amended in 1977 through Presidential Decree No. 1183.
Under the law, 50% of travel tax income goes to the Tourism Infrastructure and Enterprise Zone Authority, with 40% supporting the Higher Education Commission's tourism-related education programs. The remaining 10% funds the National Commission for Culture and the Arts.
The government collects a travel tax of P1,620 from economy air passengers and P2,700 from first class ticket holders. Exempted from travel tax are overseas Filipino workers, overseas Filipino permanent residents who stayed in the Philippines for less than one year, and children two years of age and younger.
Earlier this month, a bill was filed in the House of Representatives to remove the travel tax. A counterpart bill was filed in the Senate last year. — Ashley Erica O. jose