Sending Your Christmas Presents? Here is GREAT NEWS!

Overseas Filipino workers (OFW) who remit earnings to their families back home are now exempt from paying the documentary stamp tax (DST), following the implementation of the amended law on migrant Filipinos.

In a release posted on its website, the Philippine Overseas Employment Administration (POEA) said OFW remittances will now be exempt upon showing of proof of entitlement by the recipient.

The exemption came with the implementation of Republic Act 10022, a law amending RA 8042 or the Migrant Workers Act of 1995, which took effect early November. RA 10022 exempts OFWs from paying certain taxes such the DST and the travel tax.

Prior to RA 10022, all money transfers payable in the Philippines, including those being sent by OFWs to relatives back home, are subject to a DST of P0.30 for every P200 under Section 181 of the National Internal Revenue Code, the POEA said.

This means that OFWs pay P32.64 for every US$500 or P21,720 they send to the Philippines, the POEA explained.

This amount is on top of service fees charged by foreign and local banks, plus the P0.50 per dollar margin that domestic banks are allowed to charge when paying out remittances in pesos.

POEA records show that some 1.4 million Filipino workers were deployed overseas in 2009, with remittances for the same year amounting to over P17 billion.

Around $1.4 million in DST was taken from OFW remittances monthly, the POEA added.

For 2010, the Department of Finance has projected $19 billion in OFW remittances, the release noted.

With the scrapping of the DST on remittances, the Philippine government will be giving up P1.3 billion revenues annually, it added, but the same amount “will be pocketed by our OFWs as extra savings."—Jerrie M. Abella/JV, GMANews.TV

article from: http://www.gmanews.tv/story/207489/ofw-remittances-now-exempt-from-stamp-tax
photo from: http://blogs.inquirer.net/openforbusiness/wp-content/uploads/2008/02/peso-dollar.jpg