DOF Issues Draft Rules on VAT Refund for Tourists

The Department of Finance (DOF) has released the draft implementing rules and regulations (IRR) for the refund of value-added tax (VAT) on local goods purchased by tourists in a bid to promote the Philippines as a shopping destination.

- Louise Maureen Simeon

The draft rules were issued as the DOF invited stakeholders to a public consultation next week to clarify concerns and gather suggestions that will help ensure the proper implementation of the refund mechanism.

The draft IRR aims to prescribe the guidelines, procedures and standards for the implementation of a VAT refund system for tourists (VRS) in the Philippines.

Based on the proposed rules, a tourist may get a refund of the VAT paid on locally purchased goods if these are bought from duly accredited stores and are taken out of the Philippines as accompanied baggage within 60 days from the date of purchase.

The refund will only apply to retail and tangible goods such as clothing, apparel, electronics, gadgets, jewelry, accessories, souvenirs, food or non-food consumables and other goods intended for personal use.