O F W - M A G » OFW Remittances http://ofw.talk-pick.com The Online Magazine for OFWs | Made By An OFW - Made for OFWs Tue, 01 Sep 2009 15:00:28 +0000 http://wordpress.org/?v=2.8 en hourly 1 The Oppressive Remittance Charges http://ofw.talk-pick.com/the-oppressive-remittance-charges/ http://ofw.talk-pick.com/the-oppressive-remittance-charges/#comments Tue, 11 Aug 2009 15:00:02 +0000 http://ofw.talk-pick.com/?p=681 Yet Another Related Posts Plugin.]]> ninoy-aquino

This is how TUCP or Trade Union Congress of the Philippines described the charges being applied on OFW remittances. All OFWs will certainly agree that the remittance charges are really burdensome.

The good news for OFWs is that our lawmakers are starting to act on this issue. Lawmakers have already sought the exemption of OFWs from the documentary stamp tax (DST) for money transfers. Senator Panfilo Lacson filed Senate Bill 3255 to exempt Filipinos abroad from the DST. The same thing was proposed by Gabriela Reps. Luzviminda Ilagan and Liza Maza, Bayan Muna Reps. Satur Ocampo and Teodoro Casiño and Anakpawis Rep. Rafael Mariano as they filed House Bill 5862 to remove the DST on all monetary remittances of Filipinos abroad.

According to the militant lawmakers, some $1.5 million (roughly P70.5M) in DST is taken from OFW remittances monthly.

What is DST anyway?

Documentary Stamp Tax or DST is a tax on documents, instruments, loan agreements and papers evidencing the acceptance, assignment, sale or transfer of an obligation, right or property incident thereto.

The government charges a DST of 0.15 percent for every $200 remittance. Banks (money transfer organizations are now following) have been collecting this since the enactment of RA 8424 or the Tax Reform Act of 1997.

Based on a study conducted on global money transfer charges, the following figures show how much Filipinos spend on remittance charges:

  • United States – $12.79 to send $500 and $11.45 to send $200
  • United Kingdom – $17.75 to send $500 and $14.40 to send $200
  • Italy – $22.28 to send $500 and $19.05 to send $200
  • Germany – $13.06 to send $500 and $11.07 to send $200
  • Spain – $12.42 to send $500 and $10.64 to send $200
  • Saudi Arabia – $6.93 for either $200 and $500

OFWs are hoping that these proposed bills will soon be enacted and become laws so that the so-called modern-day heroes of the Philippines will finally be exempted from the documentary stamp tax (DST) for money transfers.

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