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Filipinos can claim 50 discount on remittance fee

Filipinos can claim 50 discount on remittance fee as a Bill discounting Overseas Filipino Workers remittance fee has been passed.

MUSCAT: Filipinos can claim 50 discount on remittance fee as a Bill discounting Overseas Filipino Workers remittance fee has been passed at the House of Representative on 2nd reading.

House Bill No. 9032, or the “Overseas Filipino Workers (OFWs) Remittance Protection Act,” which passed via voice vote, proposed a 10-50% remittance fee discount depending on the amount being remitted.

It intends to ensure “effective mechanisms be instituted to ensure the protection of rights and interests of OFWs.”

The bill provided that OFWs are entitled to 50% discounts for remittances of not more than $500 or its equivalent in other currencies; a 40% discount for $500-1,000; a 30% discount for $1,000-1,500; a 20% discount, for $1,500-2,000; and a 10% discount for over $2,000.

In exchange, it proposed that establishments granting discounts on remittance fees may claim tax deductions “based on the cost of services rendered to OFWs,” as stated in Section 5.

A mandatory financial education program will be provided to OFWs and their families by the Department of Finance (DoF), Bangko Sentral ng Pilipinas (BSP) and the Philippine Overseas Employment Administration (POEA) and other agencies.

The program shall include financial management, budgeting, investment options and other related topics to educate covered individuals with regards to earnings and remittances.

The bill also prohibits banks and non-bank financial intermediaries from raising remittance fees without consultation with the DoF, BSP, and the POEA.

The bill will also penalize, among others, misappropriation or conversion of foreign exchange remittances, taking remittances without the consent of the OFW or the beneficiary, and imposition of fees in excess of those allowed.

If found guilty of the prohibited acts, the bill proposes a P50,000-750,000 fine and subject offenders to 2 months to 20 years of imprisonment.

Representative Aurelio Gonzales Jr. of Pampanga, the principal author of the bill, said, “These OFW remittances are transferred from the OFWs to intermediaries, such as financial and non-bank financial institutions, before they reach their beneficiaries. In the course of the fund transfer, the amounts remitted are subject to several fees and high remittance charges which result in the depletion of the amount to be remitted and received.”

The bill bans financial intermediaries offering remittance services from raising their current fees without consulting the Department of Finance (DOF), Bangko Sentral ng Pilipinas (BSP), and the Philippines Overseas Employment Administration (POEA).

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