The Philippines has rolled out a new VAT refund program for foreign tourists, aiming to make shopping more appealing and boost the local economy. Under this policy, international visitors can claim refunds on the value-added tax (VAT) they pay on purchases during their stay. The move is part of the government’s strategy to attract more tourists and encourage higher spending in the country.
To qualify for the refund, tourists must take their purchases out of the Philippines within 60 days. The program covers a wide range of goods, including clothing, electronics, jewelry, and souvenirs. Officials hope this will make the Philippines a more competitive shopping destination in Southeast Asia.
Tourism Growth Falls Short of Target but Sets Revenue Record
In 2024, the Philippines welcomed over 5.4 million foreign tourists—an 8.7% increase from 2023. However, this was below the government’s goal of 7.7 million arrivals. Despite this, tourism revenue hit a record PHP760.5 billion ($13 billion), marking a 9% rise from the previous year and surpassing pre-pandemic levels.
The new VAT refund scheme is expected to further boost tourism by offering visitors extra savings. Combined with the country’s world-class beaches and cultural attractions, the policy strengthens the Philippines’ reputation as a top Asian travel destination.
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