Minimize impact of taxation on tourism, Phl urges APEC

The Philippines is urging Asia Pacific Economic Cooperation ( APEC) member countries to collaborate in minimizing the impact of taxation on tourism businesses and tourists to ensure the competitiveness of the industry in the region.

Member countries should employ a “whole government approach” to ensure the continued growth and competitiveness of tourism in the region, Department of Tourism (DOT) assistant secretary Rolando Canizal said during the APEC-Tourism Working Group (TWG) conference held last week in Boracay, Aklan.

He said APEC senior tourism and finance officials need to forge greater and stronger collaboration to eliminate, if not minimize, the impact of taxation on tourism businesses and tourists.

“The tourism sector is heavily taxed compared with other sectors like manufacturing, services,” Canizal said is an interview with The STAR.

“We saw the need to rationalize fair, equitable, transparent taxation system for both businesses and tourists,” he said, as this would spark higher demand and higher expenditure from tourists.

The tourism industry fully recognizes the important role of taxation to nation building, and a fair, equitable, transparent, and simple tax policy stimulates more economic activities that redound to increased employment and gross domestic product (GDP).

In addition, fees and levies collected from tourism need to be allocated to support infrastructure, product development, and marketing for the sector.

Canizal said the findings during the conference would be brought to other relevant fora in APEC like the Finance Ministers meeting.

“We’ll ask how finance ministers can help in forming policies and programs for taxation in the tourism industry,” the DOT official said.

Held last May 19, the Conference on Enhancing Tourism Competitiveness in the APEC Region Through Alignment of Tourism and Taxation Policies is the implementation of the first of the three APEC-TWG projects in its annual work program.

It was attended by senior tourism and finance officials from the APEC region, officials and members of the World Travel and Tourism Council (WTTC), international tourism associations, select local government executives, and local tourism industry leaders.

During the conference, APEC members assessed the impact of current taxation measures as well as their changes over time in relation to travel and tourism demand, revenues, and job growth.

The event provided a comparative analysis of taxation levels in the tourism industry versus taxes in other key sectors towards ensuring a fair and equitable treatment of taxation across industries in the region.