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A break for tourism

Tourism stakeholders have requested the deferment of the payment of local business taxes this year given the severe impact of the Covid-19 pandemic on the sector.

Tourism Congress of the Philippines president Jose Clemente III said the group has received reports from stakeholders that various local governments have been issuing assessment fees for business taxes, which most are unable to pay due to the current state of the tourism industry.

“Most only earned income during the first quarter of 2020, with nothing else after that,” Clemente said.

He added that some LGUs are basing their assessment fees on 2019 income, that does not take into consideration business conditions of pandemic stricken 2020.

“In this regard, we would like to respectfully request if the Department of Interior and Local Government can defer the payments of business taxes for 2021 in light of the pandemic and its adverse effects on tourism,” Clemente said in a letter to Department of the Interior and Local Government Secretary Eduardo Año.

The tourism industry has been among the hardest hit by the Covid-19 pandemic, given the travel restrictions imposed to curb virus transmission. Data from the Department of Tourism shows that international visitor arrivals dropped 83.97 percent to 1.3 million in 2020 from 8.2 million arrivals the previous year. This translated to an 83.12 percent drop in inbound tourism receipts for the year.

Tourism Secretary Bernadette Romulo-Puyat has endorsed the letter of the TCP, as well as a similar letter from the Philippine Travel Agencies Association on their request for the possible deferment of payment of local business taxes and extension period for the filing of business permits for 2021.

The tourism industry that is massively struggling will need as much help as it can get, especially from government. Stakeholders are certainly more than willing to pay fairly assessed taxes and fees as it is part of doing business but consideration and compromise will be the key if the sector is to survive and eventually recover from the onslaught of the pandemic.

Covid-19 has already done serious damage to the tourism sector and its contribution to employment and the economy. Government should take the lead in minimizing the damage instead of making matters worse by focusing on the wrong priorities.*

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