Along with this law, Department of Tourism as the implementing and regulating agency is bombarded with enough powers, strength, and capitalization for the effective furtherance of its purpose and implementation of various programs and policies. Certain government agencies and instrumentality were restructured and reorganized such as the Duty Free Philippines to Duty Free Philippines Tourism Corporation (DFPC), and Philippine Tourism Authority (PTA) converted to Tourism Infrastructure & Enterprise Zone Authority (TIEZA).

More importantly is the creation of the so-called Tourism Economic Zones (TEZ) somewhat similar to that of Philippine Economic Zones (PEZA under RA No. 7916), and Bases Conversion and Development Authority (BCDA under RA No. 7227) Ecozones. TEZ operators could either be a local government, itself, a private entity, or a joint venture of the two. Under this law, Tourism Enterprises within a TEZ registered under TIEZA shall be allowed certain fiscal and non-fiscal incentives under the criteria to be established by the implementing rule and regulations such as the following:

A. Fiscal Incentives:

a. Income tax holiday for 6 years, subject to extension for another six years under certain conditions;
b. 5% income tax based on gross income earned in lieu of all other national and local taxes, license fees, imposts and assessments, except real estate taxes;
c. Tax free importations of capital investments and equipment, transportation and spare parts;
d. Additional tax deductions on social responsibility expenditures not exceeding 50% of cost; and,
e. Such other incentives under certain conditions.

B. Non-fiscal incentives
a. Employment of foreign nationals;
b. Special investor’s resident’s visa;
c. Repatriation of Investments in foreign currency;
d. Remittance of foreign exchange;
e. Foreign loans and contracts

With the above incentives, along with the re-organization and restructuring, it is expected that more investors shall be coming in to establish a Tourism enterprise, or develop and upgrade their existing facilities to be entitled to the incentives. In the meantime, the corresponding Implementing Rules and Regulation of the said law is underway and expected to be released soon. The regulations will further state in details the requirements, conditions and procedures for the applicability of the incentives and privileges.

Other Updates:

a. BIR RMC No. 41-09 on 15% income tax of expats
b. RA No. 9640 Amusement tax reductions;
c. RA No. 9648 DST exemption on listed shares;
d. RA No. 9442 Magna Carta for Disabled Persons