Vice President Jejomar Binay on Wednesday said it was only right for the tax-exempt value of balikbayan (returnee) boxes to be raised to more realistic levels as he welcomed Senate approval of the provision in the proposed Customs Modernization and Tariff Act (CMTA).
The CMTA set the ceiling at P150,000 on Monday.
“The approval is a way of thanking our countrymen living or working abroad, including overseas Filipino workers [OFWs], for their sacrifices and contributions to the economy,” Binay added.
Raising the tax ceiling, according to him, is but a small token of gratitude for the millions of dollars that the OFWs and other locals based abroad pour into the country.
The Vice President previously said the current P10,000 tax limit was “no longer realistic and in tune with the times.”
The limit was set in 1978 when the exchange rate was only P7.37 to $1, he noted.
OFW remittances alone reached $20.6 billion from January to October last year, a 3.67-percent increase from the same period in 2014, according to the Bangko Sentral ng Pilipinas.
Binay, a former presidential adviser on OFW concerns, said money sent to the Philippines is helping drive the economy through domestic consumption activities done by families of OFWs.
Last year, OFWs sent a record high $24 billion to the Philippines, which accounted for almost a tenth of the country’s gross domestic product or GDP)
Binay said foreign currencies are also used by the economy in paying for imported goods and services, aside from keeping the peso stable.
He vowed to lessen the number of Filipinos working abroad and said his administration will work to increase domestic job generation if he wins the presidency in the May 2016 elections.
“My administration will focus on strengthening the five biggest creators of employment which are agriculture, manufacturing, mining, business process outsourcing and export to provide more jobs,” Binay said in previous speeches.
“Then we can say that we are going abroad because we want to, not because are forced to,” he added.
The Vice President said in the short term he will continue as well as improve the financial literacy programs taught to OFWs.
“We will intensify financial literacy programs to teach OFWs’ families to invest, not to merely spend the money sent home,” Binay added.