Tuesday, August 26, 2025

OFWs assured that remittances won’t be taxed

MANILA, Feb. 28 (PNA) — Remittances of overseas Filipino workers (OFWs) will not be taxed, Sen. Juan Edgardo Angara said Tuesday allaying concerns of value-added tax (VAT) on services fees of money transfer centres in the country.

Angara, chair of the Senate Committee on Ways and Means, made this clarification after the Department of Finance (DOF) explained in a Senate hearing that only service fee of domestic remittances and not actual remittance will be taxed with 12 percent VAT under their proposal.

“We want to clarify to our kababayans abroad that the remittances they send their families in the Philippines will not be taxed. We will make sure that they will not shoulder additional burdens,” Angara said.

DOF Undersecretary Karl Kendrick Chua said that the agency’s jurisdiction is “only domestic transfers”.

For instance, if sending PHP5,000 within Metro Manila, the money transfer center charges PHP125 pesos, so the VAT is PHP15 only, he said.

He clarified that such reform only targets businesses such as pawnshops, which are initially not registered as remittance centres.

Angara, who sponsored the law that raised the tax exemption cap of balikbayan boxes, added that OFW remittances are likewise exempt from paying documentary stamp tax pursuant to Republic Act 10022 or the amended migrant workers law.

Package 1 of the Duterte administration’s comprehensive tax reform program seeks broaden the VAT base and lower personal income tax rates, and to adjust excise taxes of petroleum products.

He, meanwhile, recognized the significant contribution of OFWs in the economy, citing recent data from the Bangko Sentral ng Pilipinas (BSP) that showed that OFW cash remittances reached USD26.9 billion or more than PHP1 trillion last year, which accounted for 9.8 percent of the gross domestic product (GDP).

Hot this week

How to Choose the Right Size Self-Bunded Fuel Tank

Choosing the right self-bunded fuel tank can make all...

What to Consider When Selecting an Air Conditioner for Optimal Comfort

Choosing the right air conditioner (AC) plays a crucial...

Filipino-Australian Director James J. Robinson wins Best Australian Director at MIFF 2025

The Melbourne International Film Festival (MIFF) 2025 has recognised...

How to Prep Your Yard for Long-Term Health

Creating a healthy, resilient yard requires more than occasional...

How Property Valuation Courses Prepare You for a Career in Real Estate

Starting a career in real estate can be both...

Topics

How to Choose the Right Size Self-Bunded Fuel Tank

Choosing the right self-bunded fuel tank can make all...

What to Consider When Selecting an Air Conditioner for Optimal Comfort

Choosing the right air conditioner (AC) plays a crucial...

Filipino-Australian Director James J. Robinson wins Best Australian Director at MIFF 2025

The Melbourne International Film Festival (MIFF) 2025 has recognised...

How to Prep Your Yard for Long-Term Health

Creating a healthy, resilient yard requires more than occasional...

How Australian Daycare Centres Prepare Kids for School

Starting school is a major milestone in a child’s...

Maghintay Ka Lamang

Ang tulang ito ni Rado Gatchalian ay alay sa...

Related Articles

Popular Categories

spot_img