Tax Free Balikbayan Boxes

Balikbayan Boxes. Whenever it is mentioned or you see one, probably the first thing that comes into your mind are goodies sent by relatives overseas. As you may have guessed, these boxes contain stuff that are practically not available in the Philippines ranging from electronic gadgets to toiletries. For Filipinos, a Balikbayan Box is the proverbial manna from Heaven. Considering they do not have the luxury to travel abroad, the Balikbayan Box gives them a taste and even the smell of being abroad.

Just when people are about to enjoy what is inside the Balikbayan Box, enter the Bureau of Customs (BOC). Given their reputation, they are regarded as the people out to spoil the fun of people expecting to receive these Balikbayan Boxes. While some BOC personnel have been found to be pilfering its contents (that is another story), the agency has a policy of imposing taxes on every Balikbayan Box that arrives in the country. Because of this policy, these boxes never gets to reach their intended recipients; thus causing a lot of heartbreaks and frustrations.

To address this issue and understanding how much Balikbayan Boxes mean to eager families and relatives, Congress passed Republic Act 10863 or the Customs Modernization and Tariff Act (CMTA) in 2015. Then-President Benigno Aquino III signed into law  on May 3, 2016. In December of that same year, the Department of Finance (DOF) and BOC (which is under the DOF), have laid down guidelines on making these Balikbayan Boxes tax-free. However, due to certain issues, the implementation was delayed until August 1 this year when the BOC would finally implement this new policy.

The Balikbayan Box. It is more than just a box of stuff. It is a labor of love of the senders to their loved ones in the Philippines. Source : CNN Philippines

How Does It Work?

Under the guidelines set by the DOF and BOC, Balikbayan Boxes with a value below US$3,000 or 150,000 Php will be tax-exempt.

Furthermore, the following are qualified to avail of this tax-free privilege:

  1. Holders of valid Philippine passports issued by the Department of Foreign Affairs and certified by the Department of Labor and Employment (DOLE) or Philippine Overseas Employment Agency (POEA). It can be gleaned here this applies to Overseas Filipino Workers, hence the certification from any of the two latter agencies.
  2. Non-resident Filipinos who have established permanent residency abroad but still retain their Filipino citizenship. This refers to expatriates (different from OFWs).
  3. Resident Filipino citizens living abroad temporarily (such as students or tourists).

The above-mentioned individuals need to submit the following requirements:

  1. A photocopy of their valid Philippine passport. This must include pertinent personal information, photograph and signature. For those with dual citizenship, they need to also submit a photocopy of their other passport with the same details required.
  2. An information sheet provide by the BOC that will serve as a packing list. This must be completely filled up and signed.
  3. An itemized list of the contents. In this regard, the sender must certify that the contents in the Balikbayan Boxes are personal effects and household goods, and must not be in commercial quantities (to be sold or distributed locally).
  4. If applicable receipts or invoices of the contents.

From the foreign country of origin, the forwarder or consolidator must submit the aforementioned documents to a local forwarder (in the Philippines) through electronic format (e-mail).

In the Philippines, the designated local forwarder will now send these documents to the BOC. This must be done before the Balikbayan Boxes arrive. The time period will depend on how it will be delivered and how long will it take.

If the shipments will arrive by sea:

For shipments that will take 3 days to arrive, the documents must be delivered to the BOC 24 hours before arrival.

For shipments that will take 7 days to arrive, 48 hours.

For shipments coming from North America, Middle East and Europe that may take longer to arrive, 10 days prior to arrival.

If shipments will arrive by air:

From Asia, 1 hour prior to arrival.

From other countries outside Asia, 6 hours before arrival.

While this policy and guidelines are a welcome relief, there are still concerns among the public. They fear there will still be delays or red tape and there is the risk of pilfering. BOC Commissioner Nicanor Faeldon was quick to give his assurances these will not happen.

He reminds international and local forwarders to comply with the set guidelines to ensure a smooth and expeditious processing of the shipments so that they reach their intended receivers efficiently and with utmost care.

He also warns port and BOC officials not to open Balikbayan Boxes on the pretext of inspecting for smuggled goods, and directed them to expedite their release to the intended recipients.

According to Faeldon, “We value the importance of each Balikbayan Box. They symbolize the hardship of our overseas Filipino workers, and the love of Filipinos abroad for their families here in the country.”

The Balikbayan Box is more than just a box of imported stuff. It symbolizes the labor of love put by our loved ones abroad who care for those in the Philippines. Whatever is inside is considered precious to them, even if it is cheap in value. Through the Balikbayan Box, Filipinos get a taste and even smell the feeling of being in another country.


Aaron Ronquillo

Quizzer, Practical Shooter, Martial Artist, Movie Buff, Avid Reader, Amateur Foodie and Photographer, Cat Lover; Someone with a wanderlust; got a keen eye for detail, trivia; enthusiastic but cautious; patient, calculating