Pinoys prefer travel abroad; high airfare, hotel rates cited

By Ma. Stella F. Arnaldo @akosistellaBM Special to the BusinessMirror

At Tuesday’s hearing on the Department of Tourism’s (DOT) P2.99billion budget at the House of Representatives Committee on Appropriations, Tourism Infrastructure and Enterprise Zone Authority (Tieza) Mark T. Lapid said about P3.2 billion in travel taxes were collected from January to July this year, or roughly P1,600 per Filipino traveler.

Tieza, the infrastructure arm of the DOT, is in charge of collecting travel taxes on outbound travelers such as Filipino citizens, taxable foreign passport holders, and nonimmigrant foreign passport holders who have stayed in the Philippines for more than one year. Departing overseas Filipino workers, Filipino citizens permanently residing abroad, and balikbayans (home - coming Filipinos) who have stayed in the country for less than a year are exempt from paying the travel tax (P1,620 on economy passage or P2,700 on first class passage).

Following this, Zamboanga Sibugay First District Rep. Wilter

Y. Palma made this observation:

“Filipinos are going out instead of patronizing domestic travel [is] because of our pricing. If you take the plane from Manila to Cebu, the average price is P5,000, whereas from Manila to Hong Kong, it’s P6,000.”

As far as hotels go, he added that “the average hotel rate here is P10,000 to P12,000 [per night], while in Hong Kong or Singapore, you can get P4,000, which is already good. Instead of traveling abroad bringing our money outside, why don’t we spend it here in the Philippines?” As per DOT data, he noted that 3.4 million international tourists arrived in the Philippines from January to August 15, 2023.

DTI asked to look into rates

T OU RISM Secretary Christina Garcia Frasco countered, however, that “it is domestic tourism which has buoyed the massive recovery of Philippine tourism, in addition to our inbound international tourists.”

She noted that the economy earned P1.5 trillion from domestic tourists last year, with 102 million domestic trips taken by Filipinos.

“While we recognize there are challenges in terms of competitiveness as far as price points are concerned, we have been in continuous conversation with the private sector, especially the airlines, hotel accommodation, and resorts providers to appeal for more competitive price points. We have also discussed the matter with the Department of Trade and Industry that is chiefly responsible to ensure price competitiveness and price aspects,” she said.

“We also have to consider the external factors that affect pricing of accommodations in the Philippines, that includes inflationary measures

BSP…

Continued from A1 and the like,” Frasco explained. She said the DOT has been “reintroducing regions to each other” by holding travel fairs and expos that highlight each region’s tourist destinations and activities as a way to further boost domestic tourism.

‘Dynamic pricing’ SINCE t he lifting of pandemic travel restrictions, the tourism sector has bounced back, although most hoteliers say they are yet to be profitable due to the lack of international tourists. However, most accommodation establishments have reverted to their prepandemic average daily rates. (See, “International tourists vital to hotels’ full recovery,” in the BusinessMirror, July 21, 2023.)

The issue of the Philippines having more expensive hotel rates compared to other countries in Southeast Asia has been regularly brought up in budget hearings and discussions on improving tourist arrivals. Hoteliers have said though that their rates do fall during the off-peak season, usually the rainy months between July and October.

On the part of local airlines, its executives have said they have adopted a “dynamic pricing scheme,” which allows the cost of airfare to rise or fall based on demand and time of purchase.