Saturday, August 10, 2024 MANILA – President Ferdinand R. Marcos Jr. has authorized a travel tax exemption for all individuals departing from any international airport or seaport in Mindanao and Palawan, provided their destination falls within the East ASEAN Growth Area, which includes Brunei Darussalam, Indonesia, and Malaysia.
This exemption, outlined in Memorandum Order (MO) 29, was signed by President Marcos on August 6 and announced in the Manila Bulletin on Friday. The exemption takes immediate effect and will remain valid until June 30, 2028, unless it is revoked earlier. Eligible travelers must have confirmed connecting flights from Mindanao and Palawan to the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) within 24 hours on the same day to qualify for the exemption.
Eligible travelers can obtain the travel tax exemption from the Tourism Infrastructure and Enterprise Zone Authority. This initiative is designed to bolster and expedite economic growth in Mindanao and Palawan by making these regions more attractive to both domestic and international investors. By easing travel costs, the government aims to encourage greater utilization of the Philippine routes within the East ASEAN Growth Area (EAGA), positioning these locations as strategic hubs for connectivity and investment.
The travel tax exemption is part of a broader effort to stimulate economic development and enhance the appeal of Mindanao and Palawan as viable entry points for business and trade in the region. By reducing the financial burden on travelers, the government hopes to foster increased traffic along these routes, thereby reinforcing their potential as crucial links in the East ASEAN Growth Area. This move is expected to draw more investors, thereby accelerating the growth and development of these key areas within the Philippines.
The decision to grant a travel tax exemption aligns closely with the strategic objectives outlined in the Philippine Development Plan 2023-2028. This plan emphasizes the promotion of tourism and the reduction of barriers that hinder trade and investment, particularly in key regions like Mindanao and Palawan. By waiving the travel tax for those departing from these areas to destinations within the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA), the government is actively working to foster economic growth, enhance regional connectivity, and attract more visitors and investors.
This exemption is not just a fiscal relief but also a crucial component of the broader economic strategy aimed at integrating these regions more deeply into the ASEAN economic framework. The issuance of Memorandum Order (MO) 29 follows a history of similar directives, wherein previous memorandums granted travel tax exemptions to passengers from Mindanao and Palawan traveling to BIMP-EAGA destinations. This consistent policy approach underscores the government’s commitment to maintaining and accelerating economic momentum in these regions.
With the immediate effect of MO 29 upon its publication in the Official Gazette or any widely circulated newspaper, the exemption will provide an immediate boost to the local economy by encouraging more travel and investment. This move is expected to strengthen the strategic positioning of Mindanao and Palawan as vital gateways to the broader ASEAN market, further integrating them into the region’s economic landscape. Boosting Economic Momentum The recently granted tax exemption is anticipated to significantly enhance the economic trajectory of the islands, particularly in Mindanao and Palawan, according to Mindanao Development Authority (MinDA) Secretary Leo Tereso Magno.
The exemption is viewed as a strategic measure to stimulate economic activity, attracting both domestic and foreign investments, thereby fostering accelerated growth in these regions. During a press briefing held in Davao City on Friday, Secretary Magno emphasized the government’s unwavering commitment to revitalizing the flow of goods and people within the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA), which also includes Palawan. He highlighted that the government is undertaking concerted efforts to reestablish and enhance transportation links, aiming to restore and even surpass pre-pandemic levels of economic engagement within this vital regional bloc.
By facilitating smoother and more cost-effective travel, the tax exemption is expected to play a pivotal role in reenergizing trade and tourism, ultimately contributing to the sustained economic development of Mindanao and Palawan..
