All You Need to Know about Tax-Free Balikbayan Boxes

Sending balikbayan boxes is one of those unique Filipino traditions. Overseas Filipino workers (OFWs) usually send their families back home boxes full of stuff (mostly chocolates, clothes, toys, toiletries, canned goods, and other gift items).

There are an estimated 2.2 million OFWs all over the world; so we can just imagine how many balikbayan boxes are sealed, signed and shipped at any given time. Now that balikbayan boxes sent by the so-called “qualified Filipinos while abroad” or QFWA are now duty and tax-free, we can expect the volume of balikbayan boxes to increase even more. The “ber” months are in fact the most popular time of the year when balikbayan boxes are sent – just in time for the holidays.

OFWs had been looking forward to the implementation of Republic Act No. 10863 or the Customs Modernization and Tariff Act (CMTA) that, among others, exempts balikbayan boxes from paying duties and taxes. Section 800 of the CMTA allows QFWA to bring in or send tax-free balikbayan boxes to their families or relatives in the Philippines upon meeting certain qualifications. The policy finally took effect in August this year.

Besides OFWs, the other QFWA are Filipino citizens with permanent residency abroad and holders of tourist visa, student visa and investors visa. Of course, the balikbayan boxes should be intended for family or relatives up to the fourth civil degree of consanguinity or affinity. The tax exemption is valid only up to three times during a calendar year and the value should not exceed Php150,000. Returning OFWs or residents can still ship or send their personal and household effects up to 60 days after their return to the country.

For more details about the tax exemption, read a copy of the Customs Memorandum Order 04-2017 from the Bureau of Customs (BoC)website (customs.gov.ph) or check out the video posted on its Facebook page on how to avail of the duty and tax-free privileges on balikbayan boxes: BoC’s Balikbayan Box 101

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