TAX NEWS - JUNE 2010

Philippines Tax: Stop charging tax on remittances, government urged

A Filipino migrant workers' group has called on the Arroyo administration to order the Bureau of Internal Revenue to stop charging documentary stamp tax on overseas Filipino workers' remittances.

Migrante made the call after several Filipino workers in the Middle East complained that tax was levied despite the provision of the tax code that has automatically repealed the passage of Republic Act 10022, or the amended version of the Migrant Workers and Overseas Filipino Act of 1995.

John Monterona, Migrante-Middle East regional director, said the new migrant statute has become a law last Mar. 10 without the signature of President Arroyo.

"After its publication, it is deemed implemented; OFWs have been exempted from DST," Monterona said.

Under the new migrant law, "The remittances of all overseas Filipino workers upon showing of the same proof of entitlement by the overseas Filipino worker's beneficiary or recipient, shall be exempt from the payment of documentary stamp tax."

"The continuing charging of documentary stamp tax is illegal and in violation of RA10022; money transfer and telecommunication companies that are still charging DST to OFWs must be prosecuted in violation of R.A.10022," Monterona added.