FOURTEENTH CONGRESS OF THE REPUBLIC ) 
OF TIHE PI-IILlPPINES 
1 
First Regular Session 
1 
S E N A T E  
Introduced by Senate President Manny Villar 
- 
EXPLANATORY NOTE 
Considered the number one global industry with direct revenue 
amounting to 523-billion U.S. dollars, tourism has become a potent vehicle 
towards achieving global economic growth, fostering goodwill and greater 
understanding among people has become more apparent in the light of the 
emerging world order where liberalization, facilitation, open trade and regional 
cooperation are the dominant forces. 
For instance, Thailand used tourism as a tool for economic recovery 
during the Asian financial crisis and for building and strengthening past 
initiatives which have produced positive results for tourism. It used the slogan 
“Amazing Thailand” to promote its tourism program through a massive 
marketing and promotional strategies designed to position Thailand as a haven 
for those who escape from a stressful, fast-moving world and its success was 
greatly attributed to the infusion of funds from the government. Thus, recent 
tourists arrivals in Thailand has exceeded the 17 millionth mark in spite of a 
military take-over in September 2006 and the continuing insurgency problem 
in Southern Thailand . 
Compared with Thailand and other ASEAN countries in terms of tourist 
arrivals, Philippines is still far below. 
During the last three years, foreign 
tourists arrivals in the Philippines did not exceed 3.09-million which is the 
highest in the country’s history and a breakthrough for the Philippine tourism 
industry. Even with aur “WOW Philippines”, an aggressive tourism campaign 
which focused on showcasing the wealth of wonders in the country that 
contributed significantly to the high rate of tourists arrivals, still we paled 
greatly . 
Tourism has long been recognized as a major contributor to the country’s 
econoinic growth and development through the generation of foreign exchange 
earnings, investm.ents and revenues. It is considered a catalyst for 
construction, manufacturing and other economic activities and a creator of 
human resource-intensive jobs, thereby helps in alleviating poverty which has 
plagued our society for decades. Likewise, it is the only industry that can fully 
utilize the country’s history, culture, and natural environment in a sustainable 
manner. 
This bill, therefore, seeks to further promote the tourism industry in the 
country by establishing a National Tourism Development Program thereby 
creating the Tourism Consultative 
Council which 
shall serve as a 
recommendatory body to the Department of Tourism (DOT). It shall formulate 
programs that shall determine, monitor and review the participation of all 


concerned agencies in tourism development; closely coordinate and work with 
all government agencies to ensure the smooth implementation of tourism plans 
and programs, among others. Consular offices in all Philippine embassies 
worldwide shall be tasked to conduct a massive marketing promotional 
campaign through a partnership endeavor with the marketing agencies in other 
countries. Likewise, additional tax incentives of double deductions shall be 
granted to hotel, tour operators and private companies 
on expenditures 
incurred for promotional activities overseas. Moreover, an EVAT refund shall 
be granted to overseas tourists on any purchases made during their stay which 
shall be claimed at the airport Customs office upon leaving the country. A 
comprehensive annual report shall be submitted to the President at the end of 
every year. 
Taking into consideration the fact that the success of “Amazing 
Thailand” was achieved with high costs on its environment and culture, this 
proposed measure shall strengthen the policies and programs geared towards 
creating an environment that foster competition, efficiency and conservation. 
In view of the foregoing, early approval of this measure is earnestly 
requested. 
Senate Pres dent 
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FOURTEENTH CONGRESS OF THE REPUBLIC ) 
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OF THE PHILIPPINES 
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First Regular Session 
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S E N A T E  
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S.B. NO.?J 
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Introduced by Senate President Manny Villar 
AN ACT 
TO FURTHER PROMOTE THE TOURISM INDUSTRY IN THE COUNTRY, 
ESTABLISHING 
FOR 
THE 
PURPOSE 
THE 
NATIONAL 
TOURISM 
DEVELOPMENT PROGRAM, CREATING THE TOURISM CONSULTATIVE 
COUNCIL, 
APPROPRIATING 
FUNDS 
THEREFOR AND 
FOR 
OTHER 
PURPOSES 
Be it enacted by the Senate and the House of Representatives of the 
Philippines in Congress assembled: 
SECTION 1. Short Title. - This Act shall be known as the “National 
Tourism Development Program Act of 2008.” 
SEC. 2. Statement of Policy. - I t  is hereby declared the policy of the 
State to promote, encourage and develop tourism as a major national activity 
in which non-governmental organizations, people’s organizations and private 
sector’s investments, efforts and initiatives are fostered and supported in order 
to realize the 
economic 
potential of tourism for national development. 
Towards this end, there is a need to strengthen the tourism policies and 
programs through the establishment of a National Tourism Program and the 
Tourism Consultative Council. 
Sec. 3. Definition of Terms. - As used in this Act, the following terms 
shall be defined as follows: 
a. Ecotourism - sustainable tourism that contributes actively to the 
conservation of natural and cultural heritage which 
includes local and 
indigenous communities in its planning; development and operation, 
contributing to their well-being; interprets the natural and cultural heritage of 
1 


the destination to visitors; and lends itself better to independent travelers, as 
well as to organized tours for a small size group; 
b. 
Sustainable tourism - a responsiblr: 
industry, ecologically and 
culturally sensitive, thus, 
a low impact on the natural 
environment and local culture, while helping to generate income and 
employment for locals, as well as to promote the conservation of local eco- 
systems. 
attempts to make 
c 
Medical Tourism 
- 
the traveling of persons to other countries for 
the purpose of availing health care services, treatment of illnesses and other 
health problems in order to maintain one’s health and wellness; 
d. 
Culture of 
Tourism - ensuring quality tourism-related industry 
products such as a sustained cleanliness and beautification drive in every 
locality; standard pricing for accommodation and amenities; warm welcome 
reception to group tours; adoption of accreditation scheme for facilities; and 
values orientation programs, among others. 
SEC. 4. National Tourism Program. A National Tourism Program 
shall be established to formulate policies, strategies and plans that shall 
provide a progressive tourism industry in the country. To ensure the effective 
implementation of 
this program, 
the following strategies shall 
be 
undertaken: 
a) improve accessibility to key tourist destinations; 
b) Liberalize civil aviation, land and sea transportation policies as they 
relate to tourism in order to cope with expected additional tourism traffic, and- 
facilitate greater access and capacity for trade on a level playing field to that of 
its main competitors; 
c) Formulate an investment promotion plan for the tourism sector to 
encourage greater local and foreign investments; 
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d) Upgrade existing tourism products to ensure the development’of a 
highly competitive and affordable market offering for tourist and introduce 
“Manila Grand Salcs” showcasing the best locallji made products from the 
different regions of the country; 
e) 
Invest in human resources development by providing manpower 
training to ensure that the quality of services provided by the country’s tourism 
staff to visiting guests are in accord with international standards; 
f) 
Ensure effective law enforcement to provide a peaceful and secured 
environment for tourists; 
g) Develop a culture of tourism among Filipinos to foster a greater sense 
of national identity, pride and commitment among its citizens; 
h) Allocate promotional and marketing budget for the promotions and 
marketing activities such as confidence building campaign that will inform all 
markets of the current security situation and the measures being taken to 
ensure the safety of tourists; 
i) 
Promote ecotourism which strikes a balance between socio-economic 
growth and protection of the environment; 
j 
Promote local tourism, medical tourism, sports tourism, agricultural 
tourism and sustainable tourism, among others; 
k) 
1). Provide updated technology communication to facilitate transactions 
Facilitate the accreditation of prime tourists destinations; 
and information needed by tourists; 
m) 
Create a program that shall apply business skills, training and 
expertise in planning, finance and marketing to tourism projects throughout 
the country; 
n) 
Provide specialized technical assistance to the development and 
expansion of tourism enterprises both local and foreign; and 
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o) Promote specialized lours, dive sites and other historical locations for 
the indigenous perspective. 
SEC. 5 . Creation of a Tourism Consultative Council (TCC). - TO 
carry out the provisions of this Act, the Tourism Consultative Council (TCC), 
hereinafter referred to as the Council, is hereby created. The Council shall 
serve as a recommendatory body to the Department of Tourism (DOT), which 
shall continue to be the 
primary government agency tasked with tourism 
program formulation and implementation, strategic marketing, promotional 
planning, and regulatory control of the tourism industry sector. 
Sec. 6. Composition of the Council. - The Council shall be headed 
by the Secretary of the Department of Tourism (DOT) as ex-officio Chairman. 
The General Manager of the Philippine Tourism Authority (PTA) shall be the 
Vice- Chairman and the following, as members : 
1. 
3. 
4. 
5. 
6. 
7. 
8. 
9. 
10. 
Undersecretary, Department of Environment and Natural 
Resources (DENR); 
Undersecretary, Department of Transportation and 
Communications (DOTC); 
Undersecretary, Department of Public Works and Highways 
(DPWH); 
Undersecretary, Department of Trade and Industry (DTI); 
Undersecretary, Department of Interior and Local Government 
(DILG); 
Head, Philippine Convention and Visitors Corporation (PCVC); 
President, Hotel and Restaurant Association of the 
Philippines (HRAP); 
President, Philippine Tour Operators Association (PHILTOA); 
President, Philippine Travel Agencies Association (PTAA); 
d 


SEC. 7. Meetings. I The Council 
shall meet at least six (6) times a 
year. 
Special meetings shall be held upon the call of the Chairman or a 
majority of its members. A member who is unable to attend a session of the 
Council may designate an alternate who must be of sufficient. rank and 
properly authorized to make decisions on behalf of the agency that is 
represented. 
SEC. 8. Powers and Functions. - The Council shall have the following 
powers and functions: 
a) 
To formulate programs in accordance with the provisions of: this 
Act; 
b) 
To determine, monitor and review the participation of all concerned 
agencies in tourism development and coordinate the policies and programs 
affecting tourism, national heritage, and environmental and natural resource 
preservation; 
c) 
To closely coordinate 
and work with all government agencies 
concerned, local government units (LGUs) and the private sector to ensure the 
smooth implementation of tourism pl.ans and programs; 
d) 
To encourage the maximum participation of the private sector in 
tourism development and to support the activities of local tourism councils; 
e) 
To formulate and enforce a system of accountability for the short 
and long term adverse environmental impact of tourism projects, programs or 
activities, which shall include the setting up of a funding or guarantee 
mechanism for clean-up and environmental rehabilitation and compensation 
for personal damages; 
f )  
To prepare a national ecotourism strategy or program which shall 
guide the development, promotion and management of sustainable ecotourism 
in the country, incorpora-ting as among its main features the identification of 
ecotourism sites, involvement of local communities, protection of the rights of 
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indigenous people, environmental education and information campaign, and 
provision of technical and financial assistance to communities which are 
included in the network of tourism sites; 
g) 
To call upon any government or private entity for assistance or 
support whenever deemed necessary to carry out the provision of this Act; 
h) 
Whenever necessary, to create such committees to conduct studies 
for the formulation of plans, programs and activities for the attainment of the 
purpose of this Act; 
i) 
To organize an Annual National Tourism Summit through the 
auspices of the DOT, as a means of ensuring wide and collective participation 
of all sectors involved in the sustainable development of tourism, as well as to 
carry out the provisions of this Act; 
j) 
To exercise or perform such other powers and functions as may be 
deemed necessary, proper or incidental to the attainment of its objectives. 
SEC. 9. Composition of the Secretariat. - The Secretariat of the 
Council shall be composed of the support staff from the DOT as appointed by 
the Secretary. 
SEC. 10. Additional Incentives for the Tourism Industry. - In 
addition to the incentives provided for under the existing laws, the following 
shall be entitled to tax deductions or tax exemptions, as the case may be, 
under the following instances: 
A. Hotels and tour operators shall be allowed to deduct from their income 
earned within the Philippines all expenditures incurred for promotional 
activities overseas such as: 
a) expenditure on publicity and advertisements in any mass media 
outside the country; 
b) expenditure on the publication of brochures, magazines and guide 
books, including delivery costs that are not charged to the overseas customers; 
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c) expenditure on market research into new markets overseas, subject to 
the approval of the Secretary of Tourism; 
d) expenditure that includes fares to any country outside the country to 
negotiate or secure a contract for advertising or participating in trade fairs, 
conferences or forums as approved by the Secretary of Tourism; 
e) expenditure in organizing trade fairs, conferences or forums approved 
by the Secretary of Tourism; 
r) expenditure on the maintenance of sales offices overseas for purposes 
of promoting tourism in the country; 
B. 
Companies shall be allowed to deduct all expenditures incurred in 
participating in an approved international trade fairs in the country; 
C. 
Tour operators who bring in at least 500 foreign tourists in groups 
in a year inclusive of tours that enter and exit the country by air, sea or land 
transportation shall be exempted from tax in respect of income derived from 
the business of operating such tours. This incentive is only applicable to tour 
operators licensed by the DOT; 
Companies that organized domestic tour packages for at least one 
hundred tourists per year get a tax exemption on the income earned. 
D. Local companies which promote international conferences in the 
country shall qualify for tax exemption on the income earned from bringing at 
least 300 foreign participants in the country; and 
E, Expenditures incurred by companies promoting and managing a 
musical or cultural group and sponsoring local and/or foreign cultural 
performances as approved by DOT, qualifies for deduction. 
SEC. 11. Massive Promotion of Tourism in Coordination with the 
Philippine Embassies Abroad. - 
The consular officers and staff of the 
various Philippine embassies abroad shall be tasked to cooperate and conduct 
a massive promotional campaign of the country in coordination with local hotel 
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and tour operators abroad and other marketing agencies. 
It shall likewise 
disseminate and promote information regarding tourism in the country as their 
contribution towards a sustainable industrial growth. 
SEC. 
12. 
EVAT Refunds for Overseas Visitors. 
- Business 
establishments shall provide overseas visitors with EVAT refund forms for 
purchases they have made before leaving the country. Purchases must cost a 
minimum of P5,OOO.OO and receipts can be claimed at the airport. The'said 
refund can be claimed at the airport before departure at the Bureau of 
Customs Office. 
SEC 13. 
Participation of LGU's. - The Local government units shall 
likewise participate and provide support for the development, marketing and 
presentation of tourism attractions in every locality. 
SEC. 14. Annual Report. - The Council shall submit a comprehensive 
and detailed report to the President for transmittal to Congress at the end of 
every year. 
SEC. 15. 
Implementing Rules and Regulations. - The Council shall 
promulgate the necessary implementing rules and regulations within one 
month from the effectivity of this Act. 
SEC. 16. 
Appropriations. - The amount of Twenty Million Pesos 
(P20,000,000.00) necessary for the implementation of this Act shall be included 
in the General Appropriations Act of the year following its enactment into law. 
Thereafter, the annual funding of Twenty Million Pesos (P20,000,000.00) shall 
be charged against the travel tax collections accruing to the national 
government. 
SEC. 1'7. Separability Clause. - If for any reason, any provision of this 
Act is declared invalid or unconstitutional, the remaining provisions not 
affected thereby shall continue to be in full force and effect. 
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SEC. 18. Repealing Clause. All executive issuances, rules and 
regulations o r  parts thereof which are inconsistent with the provisions of this 
Act are hereby repealed, amended or modified accordingly. 
SEC. 
19. Effectivity Clause. - 'This Act shall take effect fifteen (15) 
days after its complete publication in at least two (2) 
newspapers of general 
circulation. 
Approved, 
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