FOURTEENTH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
1 
Second Regular Session 
1 
Introduced by Senator Panfilo M. Lacson 
EXPLANATORY NOTE 
The Philippines is the third largest exporter of human capital. Data from the 
National Statistical Coordination Board (NSCB) showed that for the period 2000 - 2007 
roughly 7.5 million Filipinos were deployed in various parts of the world, or an annual 
average of 1,000,000 overseas Filipino workers (OFWs). 
During this same period, the OFWs remitted about P3,730billion, generating P5.6 
billion in documentary stamp taxes (DST) at P0.30 on each P200 per Sec. 181 of the 
National Internal Revenue Code (NIRC) of 1997, as amended. By the end of 2008, an 
estimated P I  .08 billion in DST would have been collected on the OFWs' remittances. 
This bill seeks to permanently exempt from the DST the OFW remittances to the 
Philippines. The continued imposition of the DST causes some of our OFWs to send 
money to their loved ones via informal channels or used schemes outside the formal 
banking sector. This is bolstered by the fact that on top of the DST, the International 
Monetary Fund (IMF) estimates that remittances to the Philippines are slapped other 
charges by the remittance companies between US$15-26 per US$200 or 7.5% to 13% 
of amount remitted (roughly P720 to P1,248 per P9,600 sent at P48:US$1). No wonder 
that in 2006, for example, the Bangko Sentral ng Pilipinas (BSP) calculated that 5% of 
OFW remittances were coursed through the informal channels. 
The share of the DST on OFW remittances vis-a-vis the total DST collection by 
the Bureau of Internal Revenue (BIR) is only 3.4%. The revenue loss that is attendant to 
this proposal could be easily recouped from the increased inflow of foreign currency 
coming from OFW remittances coursed through the banks and forex companies. 
In recognition and solicitation of the OFWs' sustained contribution to the 
economic growth of our country particularly during these difficult times, immediate 
approval of this bill is earnestly sought. 
PANF 
N 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
,:,;E 
kj &BE 
FOURTEENTH CONGRESS OF THE 
) 
~~~~~~~~~ 
;HE 
~~~~~~~~~ 
REPUBLIC OF THE PHILIPPINES 
) 
Second Regular Session 
1 
9 
MAY i a  PSYY 
S E N A T  
S. No. 3 2 5 5  
/ 
RV . 4 
i '  
i 
Introduced by Senator Panfilo M. Lacson 
AN ACT 
EXEMPTING MONEY TRANSFERS TO THE PHILIPPINES BY 
OVERSEAS FILIPINO WORKERS FROM THE DOCUMENTARY STAMP 
TAX, AMENDING FOR THE PURPOSE SECTION 181 OF THE 
NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND 
FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 181 of the National Internal Revenue Code of 1997, as 
amended, is hereby further amended to read as follows: 
SEC. 181. Stamp Tax Upon Acceptance of Bills of Exchange and Others. - 
Upon any acceptance or payment of any bill of exchange or order for the 
payment of money purporting to be drawn in a foreign country but payable in the 
Philippines, there shall be collected a documentary stamp tax of Thirty centavos 
(P0.30) on each Two hundred pesos (P200) or fractional part thereof, of the face 
value of such bill of exchange, or order, or the Philippine equivalent to such 
value, if expressed in foreign currency [.I: PROVIDED, THAT IF THE ORDER 
FOR THE PAYMENT OF MONEY DRAWN IN A FOREIGN COUNTRY AND 
PAYABLE TO THE PHILIPPINES IS MADE BY AN OVERSEAS FILIPINO 
WORKER 
DULY 
REGISTERED WITH THE 
PHILIPPINE OVERSEAS 
EMPLOYMENT AGENCY, NO DOCUMENTARY STAMP TAX SHALL BE 
IMPOSED, COLLECTED, AND DEDUCTED FROM THE AMOUNT REMITTED 
UPON ITS ACCEPTANCE BY THE RECIPIENT IN THE PHILIPPINES: 
PROVIDED FURTHER, THAT THE FACT THAT THE SENDER OF THE 
MONEY TRANSFER IS AN OVERSEAS FILIPINO WORKER SHALL BE 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
INDICATED IN THE SAID ORDER FOR PAYMENT UPON PRESENTATION BY 
THE OVERSEAS FILIPINO WORKER OF ANY PHILIPPINE GOVERNMENT- 
ISSUED DOCUMENT EVIDENCING SUCH FACT. 
SEC. 2. Separability Clause. - Any portion or provision of this Act that may be 
declared unconstitutional or invalid shall not have the effect of nullifying other portions 
and provisions hereof as long as such remaining portions or provisions can still subsist 
and be given effect in their entirety. 
SEC. 3. Repealing Clause. - All laws, decrees, executive orders, proclamations 
and administrative regulations, or parts thereof inconsistent herewith are hereby 
repealed or modified accordingly. 
SEC. 4. Efr'ecfivify Clause. - This Act shall take effect immediately after its 
publication in at least two national newspapers of general circulation in the Philippines. 
Approved, 
2