Passengers disembark from MS AIDAstella on Jan. 13, 2025 for a day at world-renowned Boracay Island. The implementing rules and regulations of Republic Act 12079 or the Value-Added Tax Refund for Non-Resident Tourists was signed Monday (March 24) as part of the government’s efforts to attract more foreign tourists. (Photo courtesy of DOT-Western Visayas)
The government has officially signed the implementing rules and regulations (IRR) for Republic Act (RA) 12079, which establishes a Value-Added Tax (VAT) refund system for non-resident tourists in the Philippines.
In a statement on Monday, the Department of Finance (DOF) announced that the IRR was signed by Finance Secretary Ralph Recto, Bureau of Customs Commissioner Bienvenido Rubio, and Bureau of Internal Revenue Deputy Commissioner Marissa Cabreros. The signing was witnessed by Tourism Secretary Christina Garcia-Frasco and Secretary Frederick Go of the Office of the Special Assistant to the President for Investment and Economic Affairs.
RA 12079 is designed to attract more foreign visitors by allowing them to claim VAT refunds on qualified purchases, encouraging them to spend more while visiting the country — a move expected to stimulate the local economy.
Under the new rules, foreign tourists or non-resident passport holders can apply for VAT refunds on goods purchased from accredited retailers, provided the total value is at least PHP 3,000. To qualify, the goods must be taken out of the Philippines as accompanied baggage within 60 days of purchase.
The refund applies exclusively to tangible retail goods, such as clothing, electronics, gadgets, jewelry, accessories, souvenirs, and consumable food and non-food items intended for personal use.
“Every 100 pesos spent by a tourist translates to 197 pesos in economic output — almost double the return,” Recto highlighted. “That means more businesses, more jobs, better incomes for Filipinos, and increased government revenues.”
He emphasized the importance of efficient implementation to fully realize the benefits of the law. Key to this is setting up a reliable VAT refund system and driving up tourism numbers.
“We want more tourists to come — and we want them to stay longer, spend more, and enjoy a seamless experience,” he said.
In line with President Ferdinand Marcos Jr.’s directive, Recto pledged to make the VAT refund process straightforward, inclusive, and accessible for all tourists.
“At the Department of Finance, we are committed to creating a VAT refund system that is world-class, transparent, and user-friendly,” Recto stated.
The IRR also directs the DOF to partner with internationally recognized VAT refund operators to implement an end-to-end solution. Refunds may be processed electronically or in cash, enhancing ease of use for travelers.
“Our goal is simple,” Recto concluded. “We want tourists to leave the Philippines not just with souvenirs, but with a lasting impression of a country that delivers on its promises — one that welcomes them with not just smiles, but with efficient systems and thoughtful policies.”