Duty Free Shops on Clark in Angeles City - Philippines

For some people in the industry sector, the continuous increase of sales by duty free shops is hurting their sector. Duty Free Philippines, the company that started it all, is now among the top four largest sellers in the world, next to San Franciscos DFS Group, Britains Allders International, and Connecticuts Duty Free International. These were the findings of Duty Free News International, a trade paper.

Duty free shops on Clark are likewise on the rise. The PX Club, located just a few minutes drive from the gate, sells foreign goods at low prices. According to Allan Uy, Manager of the Savers Mart Store, duty free shops are taking away 30 to 40 percent of their sales without paying any duties and taxes.

Although the rules governing duty free shops are quite complicated, travelers need to purchase in dollars. Upon arrival, guests need to buy up to $1,000 on duty-free items within 48 hours. The limit for returning OFWs is higher at $2,000. In Clark and Subic, the annual spending limit is $200 even if they never go back abroad. The local residents have a monthly limit of $100 even if they do not travel.

Duty free shops on Clark are becoming popular because the former US facility is being groomed as a major center of operations of different medium-sized and large companies in Asia. These establishments stretch 2,200 hectares which is half of Clarks total land area.

Since its inception in 1993, close to 389 foreign and local investors have transferred to the Freeport Zone and generated around $24.33 billion dollars. In 2006 alone, a total of $1 billion worth of exports were generated by investors within Clark itself. It has likewise produced over 47,000 jobs for residents of the neighboring provinces of Bulacan, Tarlac, and Pampanga.

On March 13, 1992, Republic Act 7227 was signed into law. It converted the former naval bases of Clark and Subic into special economic zones which will spark economic and social progress in Central Luzon.

On April 1, 1993, then President Fidel V. Ramos signed Executive Order 68 which imposes an entrance fee of P50 on all non-passengers to duty free shops under Duty Free Philippines in order to generate income and comply with budgetary requirements as well as to make up for whatever losses these shops would bring to the local industry.

In the case of duty free shops on Clark as well as in Subic, such entrance fee were not imposed which placed Duty Free Philippines at a disadvantage. Eventually, President Ramos signed a moratorium on setting up of duty free shops in international entry points.

According to a Supreme Court ruling, duty free shops on Clark are exempted from tax and duty-free privileges without a supporting provision granting it such as the one under Republic Act 7227 or the 1992 Bases Conversion and Development Act.

Finally, duty free shopping incentives were terminated when President Joseph Estrada signed into law Executive Order 444. Under this EO, only qualified individuals would be granted shopping privileges in duty free shops on Clark.