The Department of Tourism (DoT) expects a boost in tourism revenues following the signing of the implementing rules and regulations (IRR) for Republic Act No. 12079, or the VAT Refund for Non-Resident Tourists Act, on Monday.

Tourism Secretary Cristina Garcia Frasco said the implementation comes at a time when tourism spending in the Philippines is at a record high.

“According to the World Travel and Tourism Council, in comparison with our ASEAN neighbors, tourists that come to the Philippines spend the highest per capita at no less than 2,073 US dollars. And we foresee that with the implementation of this VAT refund act, we will be able to ensure more benefits for our local tourism stakeholders in the component of shopping tourism,” Frasco said.

RA 12079 aims to encourage more foreign tourists to shop and spend while in the country, further contributing to economic growth.

The IRR was signed by Finance Secretary Ralph Recto, Bureau of Customs (BOC) Commissioner Bienvenido Rubio, and Bureau of Internal Revenue (BIR) Deputy Commissioner Marissa Cabreros. The signing was witnessed by Frasco and Special Assistant to the President for Investment and Economic Affairs Secretary Frederick Go.

Under the IRR, non-resident tourists or foreign passport holders may apply for VAT refunds on locally purchased goods worth at least P3,000 from accredited stores. The items must be taken out of the country within 60 days from the date of purchase as accompanied baggage.

The refund will cover retail and tangible goods such as clothing, electronics, gadgets, jewelry, accessories, souvenirs, food or non-food consumables, and other personal-use items.

Frasco said the swift passage and signing of the law and IRR signals a responsive and action-oriented administration.

“What the speed of the signing of the law and the signing of the IRR indicates is this: that under the administration of President Ferdinand R. Marcos Jr., this is a government that listens, that acts, and that puts forth the welfare of the Filipino people first and foremost,” she said.

She also emphasized the broad economic benefits of the law.

“We foresee that the ripple effect of the implementation of this law will be vast—not only in terms of retail, but also in terms of the sectors that will benefit from the generated income, such as shopping, accommodations, transport, and other related services,” she added.

Earlier, the DoT reported the Philippines had earned a total of US$1.1 billion or P65.3 billion from tourism-related activities, products, and services as of 28 February 2025.

Best global practice

Special Assistant to the President Secretary Go welcomed the signing of the IRR, saying the Philippines now aligns with regional peers adopting global best practices to attract international visitors.

“More importantly, this measure responds to the calls of tourism groups, further demonstrating our government's commitment to listen and address the needs of our stakeholders. This new law will encourage more tourism spending, which means more revenue for our stores, jobs for Filipinos, and more growth for our economy,” Go said.

He also noted the law's multiplier effect on industries not directly covered by VAT refunds, including hospitality, restaurants, hotels, and transportation.