Finally, the promise to increase the tax-exempted value of balikbayan boxes sent from overseas Filipinos has been enacted into law.
President Benigno S. Aquino III on Tuesday signed Republic Act No 10863 or the Customs Modernization and Tariff Act which increases the value of balikbayan box content exempted from tax duties. Under CMTA, the tax exemption ceiling has been increased from a mere P10,000 to P150,000.
The law also raises the de minimis value from P10 to P10,000. The de minimis value refers to the value of tax and duty free goods as well as the minimum cost required for items to undergo formal entry via the Bureau of Customs (BOC.)
To address inflation factor, Senator Juan Edgardo Angara who sponsored the CMTA said the law also provides for an “automatic indexation” of the amounts every 3 years.
“With the increase in the values, we lessen the discretion of the Customs officials to inspect goods and collect taxes, thus minimizing cases of corruption and smuggling,” said Angara.
Before getting the approving signature of the President, CMTA has been approved by the House of Representatives on Nov. 12, 2015; the Senate passed its version on Jan. 18, 2016.
CMTA allows each overseas-based Filipino up to send three balikbayan boxes capped at P150,000 value every year, provided that goods are not for any commercial purposes.
Filipinos who lived abroad for 10 years will get a P350,000-tax exemption while those who lived overseas for at least 5 years will be entitled to tax and duty free personal and household effects worth P250,000.
Angara expressed hope that the CMTA would help change the perceived image of the BOC as “one of the most corrupt and underperforming government agencies in the country,” which has prompted President-elect Rodrigo Duterte to vow to privatize the agency.
“Pero umaasa tayo na sa pamamagitan ng mahigpit na pagpapatupad ng batas na ito at sa tulong ng bagong administrasyong Duterte, magbabago at maisasaayos ang kalakaran ng Customs (But we are hoping that through the strict implementation of this law and with the help of the Duterte administration, we will be able to fix how Customs is being run),” he said.