House panel backs bill abolishing travel tax

The House Committee on Appropriations approved a measure abolishing the travel tax, moving the proposal closer to plenary action while securing assurances from economic managers that government programs currently funded by the levy will remain supported.

The proposal is anchored on House Bill No. 7443 authored by Majority Leader Ferdinand Alexander “Sandro” A. Marcos of Ilocos Norte, who is pushing for the repeal of the travel tax to ease the cost of travel for Filipinos and remove what he described as an outdated financial burden on passengers.

“The travel tax was created in a very different economic context. Today, it has become an added cost that restricts mobility and weighs heavily on ordinary Filipinos who simply want to travel for work, family or opportunity,” Marcos said.

The travel tax, imposed under Presidential Decree No. 1183 and related provisions of the Tourism Act of 2009, currently generates roughly P8 billion annually.

Its proceeds support the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), the Commission on Higher Education (CHED) through the Higher Education Development Fund, and the National Commission for Culture and the Arts (NCCA).

The proposal reached the Appropriations panel after the House Committee on Tourism, chaired by Romblon Rep. Eleandro Jesus Madrona, and the House Committee on Ways and Means led by Marikina Rep. Miro Quimbo earlier approved a consolidated bill abolishing the tax.

However, fiscal committees required lawmakers to determine how the government would replace the revenues currently used to fund tourism, education and cultural programs.

Appropriations Committee chair Nueva Ecija Rep. Mikaela Angela Suansing said the panel supports removing the tax but wants to ensure that funding gaps will be addressed.

“I’m not saying that we shouldn’t fill the vacuum. I’m not saying that at all. I am very much supportive, and that’s why we’ve been working with the Department of Finance (DOF) and the Department of Budget and Management (DBM) to make sure the funding vacuum is filled,” she said.

Suansing said she wants to ensure that replacement funding will match the actual needs of the affected agencies.

“I just want to make sure that whichever vacuum we’re filling is the amount that the agencies really need and will utilize,” she added.

Before the panel approved the measure, Suansing reminded economic managers of their commitment to help bridge the funding gap.

“Before we end the discussion on this, again to the DOF and the DBM — we are able to pass this measure with the strong commitment of the DOF and the DBM to help the three agencies bridge the gap in terms of the funding vacuum,” she said.

“Please, please, please hold up your end of the bargain. Please work very hard with the three agencies to ensure that the necessary funding is supplied,” Suansing added.

Representatives of the DOF and DBM assured lawmakers they would coordinate with the concerned agencies to address funding requirements once the tax is abolished.

TIEZA warned that the tax accounts for the bulk of its operating budget and helps fund tourism infrastructure projects across the country.

CHED said the Higher Education Development Fund relies heavily on travel tax collections to support scholarships, research and institutional upgrading.

The NCCA also noted that its share finances grants, cultural programs and heritage conservation initiatives nationwide.