Press Release
November 12, 2016


Senator Sonny Angara has called for the immediate implementation of higher tax exemption ceiling for balikbayan boxes as Christmas season nears.

Pursuant to Republic Act 10863 or the Customs Modernization and Tariff Act (CMTA), which was signed into law in May, balikbayan boxes sent by any Filipino worker or resident abroad not exceeding P150,000 in value are exempted from taxes and duties.

As balikbayan boxes usually take four to six weeks to arrive, Angara urged the Bureau of Customs (BOC) to fast-track the Customs Administrative Order (CAO) for balikbayan boxes so that overseas Filipino workers (OFWs) can finally enjoy the benefits of the new law especially during the holiday season.

"Sigurado akong nagsisimula nang mamili ng mga ipapadala ang ating mga kababayan abroad. Kapag naipatupad ang batas na ito, tiyak na maraming OFW ang matutuwa dahil mas mura na ang pagpapadala ng balikbayan box dahil wala ng buwis," said Angara, chairman of the Senate ways and means committee, who sponsored the CMTA law.

According to the BOC, the number of balikbayan boxes shipped to the country, which is around 400,000 every month, doubles during the Christmas season.

Angara cited studies that showed that overseas Filipinos, on the average, send balikbayan boxes to their families back home three to four times a year, containing approximately P80,000 worth of goods and items.

Before the CMTA was enacted, the tax exemption ceiling for balikbayan boxes was only P10,000.

The new law also provides that overseas Filipinos can send up to three P150,000-worth of tax and duty free balikbayan boxes in a year, given that the goods are not in commercial quantities nor intended for barter, sale or for hire.

Based on the latest data from the Commission on Overseas Filipinos, there are over 10 million Filipinos working or residing abroad.

"Ang balikbayan box ay hindi lamang lalagyan ng mga pasalubong. Sa pamamagitan ng mga padalang ito, parang ramdam na rin ng pamilyang Pilipino ang presensiya at pagmamahal ng kanilang mga kaanak sa abroad. Ito ay nagbibigay ng ilang minutong pagsasalo-salo ng mga pamilyang magkakahiwalay tuwing Pasko," the lawmaker said.

The BOC has conducted a public consultation on rules governing balikbayan boxes last November 3, and has posted the draft CAO for balikbayan boxes on its CMTA microsite.

The bureau said it aims to implement the CAO early December.

On top of the tax and duty free balikbayan boxes, the CMTA law also grants Filipinos, who have stayed in a foreign country for at least 10 years and are returning to the Philippines, tax exemption for the personal and household effects, not exceeding P350,000, they will be bringing with them when they return to the country.

As for Filipinos who have lived overseas for at least five years, they will be entitled to tax and duty free personal and household effects amounting to P250,000, while those who have stayed abroad for less than five years can enjoy P150,000 tax-free ceiling.

RA 10863 raises as well the de minimis value, which refers to the value of tax and duty free goods and the minimum cost of goods required to undergo formal Customs entry, from the present P10 to P10,000.

The 166-page CMTA generally aims to simplify, modernize and align with global best practices the country's customs procedures.

The Department of Finance plans to consolidate the CAOs of the major provisions of the law to form the implementing rules and regulations of the CMTA.

News Latest News Feed