On Tuesday, 24th February, the Philippine House of Representatives announced that it consolidated 18 separate bills calling for the abolition of the outbound travel tax currently being collected from Filipinos travelling overseas.
The announcement comes at an interesting time for the Philippine travel and tourism sectors: as of January 2026, the number of Filipinos travelling abroad increased by eight percent from the total seen during the same period in 2025.
Each of these travellers is charged the equivalent of US$28.10 if they’re flying economy and US$46.84 for business and first class.
An issue nearly decades in the making
To understand why the Philippine travel tax is so controversial is to go back to its origins.
The tax was established as far back as the 1950s just after the Second World War, then later codified under Presidential Decree (PD) No 1183 which was ratified on 21st August 1977 by then-President Ferdinand Edralin Marcos, father of the current Philippine President Ferdinand Romualdez Marcos Jnr.
Created as an alternative measure to provide adequate funds for government programmes, simplify tax collection, and reduce tax avoidance, the travel tax worth 15 percent of one's total airfare was levied upon all citizens of the Philippines, permanent resident aliens, as well as non-immigrant aliens who stayed in the Philippines for a period of not less than one year.
PD No 1183 further states:
There shall be based on the fares on the trip from the Philippines and the trip returning on going to the Philippines as well as the fares paid in foreign countries in continuation of the trip from the Philippines and the trip returning or going to the Philippines.
While the amount charged has changed due to inflation and other factors, the primary stipulations regarding the tax have changed little since the late 1970s.
Where does the money go?
Given the recent issues regarding rampant corruption and collusion between Philippine government agencies and contractors from the private sector, it isn’t surprising that both lawmakers and the public are calling for transparency when it comes to where revenues collected from travellers go.
The current breakdown for allocation is as follows:
- 50 percent goes to the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) to finance tourism infrastructure projects, such as rest stops, cultural heritage site restorations, and eco-tourism development;
- 40 percent is allocated to the Commission on Higher Education (CHED)’s Higher Education Development Fund (HEDF) as a means of supporting tourism-related educational programmes, scholarships, and institutional upgrades; and
- The remaining ten percent is given to the National Commission for Culture and the Arts (NCCA) which uses the funds to safeguard the country’s cultural heritage, arts, and traditions.
It should be noted at this point that about 90 percent of TIEZA’s total operating budget is derived from the travel tax and, contrary to popular belief, it has never been used for airport maintenance.
Why scrap it now?
When you put the reasons for charging the travel tax in writing, it does sound like a plausible, even noble, thing.
However, it is interesting to note that the reasons for charging the travel tax are rarely explained to the common Filipino traveller, and the cost is seen as onerous and burdensome, especially for travellers on increasingly tight budgets.
On Sunday, 22nd February, the editorial of The Philippine Daily Inquirer pointed this matter out bluntly:
“Authors of the pending bills have commonly cited the following reasons for scrapping it: to ease the burden on Filipinos who are already weighed down by other taxes on income and consumption, and to align with the Association of Southeast Asian Nations Tourism Agreement of 2002, which calls for a phaseout of travel levies and travel taxes on nationals of member states.”
However, agencies like the Philippine Department of Finance remain adamant that the travel tax shouldn’t be scrapped as this could lead to losses of up to US$88.4 million per annum.
However, authorities calling for the abolition are making it clear: no transparency, no tax.
Senator Sherwin Gatchalian, author of Senate Bill No 1896 (The Travel Tax Abolition Act of 2026) has opined that the tax serves more as a bar to mobility and the growth of outbound tourism.
As he declared in his filing on Wednesday, 25th February: “As we adapt to the rapid course of globalisation where borders open and connectivity grows, we must dismantle barriers that restrict mobility, discourage tourism, and limit business opportunities especially for micro and small enterprises. [The] travel tax must be removed to help promote greater mobility, stimulate the economy, and encourage regional and global cooperation and development among nations.”
As of press time, the debate continues; but if one were to ask the common traveller if they would be in favour of the abolition, the answer would certainly be a yes.
