Philippines: E-visas, tax refunds key to become Asia's shopping capital

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It is not too late for the Philippines to become the shopping capital of Asia, but it will need to implement an e-visa system and provide tax refunds to tourists to be able to do so, according to the government's economic czar.

'I think we always have that potential to be the shopping capital in Asia,' Special Assistant to the President for Investment and Economic Affairs Frederick Go told reporters during the National Retail Conference and Expo yesterday.

To position the Philippines as the region's shopping capital, he said the country needs to put in place two basic requirements: e-visas and value-added tax (VAT) refunds for tourists.

'To become a shopping capital, that means you're attracting visitors from all over the world to come here and enjoy and shop. So we need the e-visas. We need to make it easier for travelers to come to the Philippines,' he said.

The e-visa system allows foreign tourists to apply for their temporary visitors' visa online.

Go said providing VAT refunds to tourists is another basic requirement for the country's push to become a shopping destination.

'Practically every country in Asia has VAT refund for tourists. We don't. So if we indeed want to become a shopping capital of Asia or of the world, we need to have those two as basic,' he said.

To implement the VAT refund for tourists, he said there will need to be a law and stringent process. He said the Philippines can be guided by how other countries are implementing the VAT refund for tourists.

Should the government implement the VAT refund system for tourists, he said this would boost tourism and economic activity.

'I really believe that tourism is a very low-hanging fruit. It's one of the easiest things we can boost,' he said.

He said the implementation of VAT refunds for tourists will also make the Philippines attractive for luxury brands.

While other countries in the region have become hot shopping destinations, he said the Philippines has not missed the boat and can still catch up.

'People travel every day, every week, every month. You never miss the boat. People travel all the time,' he said.

Philippine Retailers Association president Roberto Claudio said the group has been pushing for the implementation of the VAT refund scheme for tourists, with the sector expected to be among those to benefit from such.

'Take note that the second biggest expense of the tourists is shopping after their hotel and their fare. Shopping is their second biggest expense. So, a majority of tourists come to visit not just for the attractions, the resorts, the diving or the food. But remember, they all shop before they go home,' he said.

He said retailers will need to start preparing for the VAT refund scheme.

'The overall benefit to the economy is going to be enormous and retailers will be the first one to be in the front line,' he said.