Tax exemptions and covered travelers
- Section 2 exempts the following from payment of the Travel Tax imposed under Section 1:
- Officials and employees of the Philippine Government (and its departments, bureaus, and instrumentalities) traveling on official business.
- Persons whose fares are paid out of Philippine Government funds.
- Foreign diplomatic and consular officials and members of their staff duly accredited to the Philippines, including the immediate members of their families and household domestics whose entry as such has been authorized by the Philippine Government.
- Officials, consultants, experts, and employees of the United Nations Organization and its agencies, and those exempted under existing laws, treaties, and international agreements.
- Personnel of multi-national companies with regional headquarters at, but not engaged in business in, the Philippines.
- Officials and employees of private companies traveling on official business, duly certified by the employing company, with fares paid out of company funds, if the company had already paid PHP 4,000 or more as travel tax for the company’s officials’ or employees’ previous travels during the calendar year.
- Crew members of ships and airplanes plying international routes leaving the country to join their vessels or airplanes, or to assume their position therein, and those being repatriated upon termination of employment.
- Filipino citizens who are permanent residents of foreign countries who have stayed in the Philippines for less than one year, with fares either paid in the Philippines in acceptable foreign currencies or payable outside the Philippines.
- Bona-fide students whose studies abroad have been approved by the NEDA Scholarship Committee.
- Non-professional contract workers whose employment contracts have been duly approved by the Department of Labor, including their spouses and dependents 21 years of age or below.
- Infants who are two years old or less.
- Section 2 establishes that the exemption list is applied to travelers who would otherwise be liable under Section 1, but only for the categories enumerated.
Non-revenue tickets rule
- Section 3 requires persons traveling on non-revenue tickets to pay the Travel Tax under Section 1, based on the classification of their non-revenue tickets, unless otherwise exempted.
- Section 3 exempts airline and shipping personnel traveling on official company business from the non-revenue ticket rule.
Collection of travel tax
- Section 4(a) provides that for departing passengers, the Travel Tax shall be collected by the carrier and/or travel agency issuing the ticket, and that such entity must remit collections to the Bureau of the Treasury within the first ten (10) days of every succeeding month.
- Section 4(b) provides that for arriving passengers, the Travel Tax shall be paid by the passenger himself within thirty (30) days from the date of arrival, based on fares paid in a foreign country.
Tax clearance capacity to pay
- Section 5 requires persons traveling to be able to establish capacity to pay the overall costs of the travel when applying for a Tax Clearance.
Implementing rules
- Section 6 directs the Secretary of Finance and the Secretary of Tourism to promulgate rules and regulations to carry out the provisions of the Decree and ensure the effective collection of the imposed tax.
Criminal penalties and administrative consequences
- Section 7 imposes criminal liability on any person who violates any provision of the Decree, violates rules and regulations issued pursuant thereto, or causes another to violate, or makes any material misrepresentation in connection with the Decree.
- Section 7 provides that upon conviction by a Court of competent jurisdiction, the penalty is imprisonment of not less than two years but not more than five years, or a fine of not less than PHP 2,000 but not more than PHP 10,000, or both, at the discretion of the court.
- Section 7 provides that any such violation ipso facto constitutes a valid ground for the revocation of all privileges, permits and authorization granted to the person or entity by the Department of Foreign Affairs, Department of Tourism, Department of Trade, Board of Investments, or other government agencies.
- Section 7 provides corporate/officer liability: if the offender is a corporation, firm, partnership, or association, the penalty is imposed on the principal officer or officers (as the case may be). If any principal officer(s) is/are an alien, they shall, in addition, be part of the Commission on Immigration and Deportation.
- Section 7 provides public-official consequences: if the offender is a public official or employee, the person shall be dismissed from the service and suffer perpetual disqualification to hold public office, in addition to the prescribed penalties.
Repeal of inconsistent laws; effectivity
- Section 8 repeals or modifies all travel tax provisions under Republic Act No. 1478, as amended, and Republic Act No. 6141, and repeals or modifies all other acts, executive orders, administrative orders, proclamations, decrees, rules and regulations, or parts thereof, inconsistent with the Decree.
- Section 9 states that the Decree takes effect immediately.
- The Decree is Presidential Decree No. 1183, August 21, 1977, issued by Pres. Ferdinand E. Marcos, amending and consolidating travel tax provisions on Philippine Travel Tax in lieu of earlier laws.