Travel agencies seek one year tax holiday, subsidies

Published April 19, 2020, 12:00 AM

by manilabulletin_admin

By Bernie Cahiles-Magkilat

The Philippine Travel Agencies Association (PTAA) is seeking a range of tax relief from corporate income tax and value added tax holiday, waiving of office rentals and salary subsidies, among others, stressing they have been heavily burdened by the relief and by the coronavirus (COVID-19) pandemic.

In a letter sent to Tourism Secretary Bernadette Romulo- Puyat, the PTAA said their members’ operations are now at risk especially with the continuation of the enhanced community quarantine until April 30 this month.

“As you are already aware, travel agents and tour operators have been badly affected. We are bleeding and we will continue to bleed for an undetermined length of time with all the uncertain¬ties,” PTAA President Ritchie Tuaño said.

According to Tuaño, they are seeking the assistance of the Department of Tourism (DOT) for a favorable endorsement of their request to concerned government agencies.

The PTAA has divided the provisions they are seeking into “Survival Recommendations” which will cover the remainder of the year and “Recovery Recommendations” which will run until December 2022.

Immediately, the PTAA wants the government to defer corporate income tax payments for their members this year to April 2021. They are also seeking corporate income tax and value added tax holiday this year for their members along with the withholding of taxes on salaries and professional fees.

The PTAA is also asking for 50 to 75 percent subsidies on the salaries of their members’ employees until the end of the year citing the model being used in Singapore. At the same time, they want a waiver on both employees and employer’s contribution to the Social Security System, Home Development Mutual Fund, and the Philippine Health Insurance Corp. without prejudice to the benefits of their employees.

The association is also seeking a waiver or significant discounting on office rentals of their members until the end of the year, up to 30 percent discount on utilities payments, the granting of soft loans at low interest payable over two years, and moratorium on outstanding bank loans until end of the year.

Over the next two years, the PTAA is requesting for a significant stimulus package from the government including the reinstatement of the standard travel agency commission of nine percent gross fare from airlines which, over the past few years, steadily became non-existent with the rapid use of business-to-consumer models among airlines.

The PTAA also wants the DOT and the Tourism Promotions Board to subsidize the staging of the Travel Tour Expo (TTE), its annual flagship project, while also asking the government agencies to encourage the participation of all regional and provincial tourism offices in the expo.

In line with the TTE, the association also wants the DOT together with the Department of Trade and Industry, Department of Finance (DOF), and Department of Transportation to encourage credit card companies to partner with the PTAA instead of coming out with competing events and promos.

The PTAA is also looking for the DOF to provide tax yield incentives to all DOT-accredited tourism enterprises including hotels, resorts, transportation companies, restaurants, travel agencies, and tour operators for the savings to be passed on to the public.

The PTAA then wants the DOT to start a nationwide caravan including familiarization trips using travel agencies to stimulate domestic tourism. It also wants the DOT to waive participation fees for travel agencies and tour operators attending international tourism events until end of 2021.