Airfare Down, Tourism Up: Travel Tax Abolition to Generate P22B Revenue, Says Miro Quimbo

The proposal to scrap the travel tax, formalized in House Bill 7443, authored by House Majority Leader Ferdinand Alexander “Sandro” Marcos, has gained significant momentum. Recently included in the Legislative-Executive Development Advisory Council (LEDAC) priority list, the measure is being fast-tracked with a target passage before the June break.

Rep. Quimbo describes the tax as a “relic” of a different era. Originally imposed during the administration of Ferdinand Marcos Sr.in 1977, the tax was designed to limit the outflow of foreign currency at a time when overseas travel was a luxury reserved for the ultra-wealthy.

“But today, everybody travels,” Quimbo noted. “It has become a major obstacle to the ability of our countrymen to travel.” In a modern economy where mobility is linked to opportunity, work, and family, a flat tax on departure feels more like a penalty than a policy.

The “No-Brainer” Math: From P7.5B Loss to P22B Gain

Critics of the bill often point to the P7.5 billion in annual revenue the government currently collects from the travel tax.This money is historically split between the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), the Commission on Higher Education (CHED), and the National Commission for Culture and the Arts (CCA).

However, Quimbo argues that this is narrow-minded accounting. According to the Committee on Ways and Means’ study, removing the tax will trigger a “domino effect” of economic activity:

Lower Airfares: Scrapping the tax would immediately slash the cost of tickets by up to 20% for popular short-haul destinations like Singapore, Hong Kong, and Bangkok.
Increased Volume: Cheaper tickets mean more people traveling. This leads to higher sales for travel agencies, airline companies, and auxiliary services.
Higher Tax Collections elsewhere: As travel-related businesses earn more, their corporate income tax contributions rise. Quimbo projects that this surge in economic activity will result in P22 billion in additional revenue—nearly triple what the current tax generates.

“It’s a no-brainer,” Quimbo asserted. “While there might be an initial loss, the collections over the next 18 months would more than offset it.”

Humanizing the Journey: Why This Matters to You

Beyond the billions of pesos, the abolition of the travel tax is a deeply human issue.For a family of four, the travel tax addsP6,480to their expenses before they even leave the ground.That is money that could have gone toward a better hotel, more educational experiences for children, or simply a safer emergency fund while abroad.

The Philippines is currently theonly country in the ASEAN regionthat still collects a tax on outbound travel.This puts Filipino travelers at a competitive disadvantage and makes the country an outlier in a region that is increasingly focused on seamless connectivity and open borders.

President Ferdinand R. Marcos Jr. has signaled his full support for the measure, emphasizing that Filipinos travel for many reasons—not just leisure. Many go abroad for work, specialized medical treatments, or family emergencies. For these individuals, the travel tax isn’t just an “extra fee”; it’s an unnecessary financial burden during high-stress moments.

What Happens to the Beneficiaries?

A common concern is the potential defunding of tourism infrastructure and scholarships. Under the proposed bill, the funding for TIEZA, CHED, and NCCA will not disappear. Instead, these agencies will be funded directly through the General Appropriations Act (GAA) or the national budget.

This shift ensures that vital programs—like the preservation of heritage sites or tourism-related scholarships—are no longer dependent on the fluctuating number of people flying out of the country. It brings stability to these sectors while freeing the public from an archaic fee.

The Road Ahead

With the House of Representatives aiming for approval before mid-2026, the dream of “tax-free” travel is closer than ever. Rep.Quimbo’s optimistic projection of a P22 billion revenue boost offers a compelling “win-win” narrative: the government gets more money through a healthier, more active economy, and the Filipino people get the freedom to explore the world without a “departure penalty.”

As the bill moves to the Senate, travelers are keeping a close eye on the calendar. If passed, the abolition of the travel tax could be the single most significant “gift” to the Filipino traveler in decades—paving the way for a future where the sky is truly the limit.

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