Returning OFWs get tax-free privileges

Overseas Filipinos returning home will be able to buy or bring in tax free goods worth $20,000, should they want to start a business, after President Gloria Macapagal-Arroyo signed a bill into law yesterday.

The goods could include instruments, computers or any other items necessary for the practice of one's trade or profession.

Under the new 'Balikbayan' law, returning OFWs are exempt from paying taxes on these goods.
The law goes into effect within a month of its publication in the official gazette.

Republic Act No. 9174, which amended the Balikbayan (returning overseas Filipinos) law "acknowledged the contribution of overseas Filipino workers (OFWs) and former Filipino citizens to the Philippine economy through the foreign exchange inflows and revenues they generate", a statement from the presidential palace said.

Senator Noli de Castro, an author of the measure, said the amendments to the Balikbayan law are aimed at helping OFWs start their own enterprise after working abroad for several years.

The new law also entitles OFWs and other returning Filipinos to discounted rates in domestic carriers, and raises by $500 tax-exempt purchases at duty-free shops from the previous $1,000 limit.

For former Philippine citizens, the Balikbayan law also provides visa-free entry for one year.

The president also signed Republic Act No. 9177, declaring the first day of Shawwal a national holiday for the observance of Eid Al Fitr, and the tenth day of Zul Haj as a regional holiday in the Autonomous Region in Muslim Mindanao (ARMM) for the observance of Eid Al Adha.