It has been a tradition for many Oversees Filipino Workers (OFW) and all other Filipinos who have moved abroad to send balikbayan box to their loved ones in the Philippines. Balikbayan box usually contains gifts and items such as toiletries, household items, non-perishable food, electronics, toys, shoes, designer clothing, or items that are not available or difficult to find in the Philippines.
Philippines Bureau of Customs (BoC), define balikbayan boxes as “packages of personal effects and/or ‘pasalubongs’ sent by Filipinos residing or working abroad to their families or relatives in the Philippines.” While, Arman Hernando, spokesperson of migrant workers’ rights group described balikbayan box as the “most personalized translation of love and affection for its recipients.”
The surge of Filipinos from different parts of the world send balikbayan boxes to the Philippines is during the Christmas season, it is during this time that they send gifts to their loved ones. In the 2015 data of the Port of Manila, the largest international shipping gateway to the country, the majority of all these balikbayan boxes sent to the Philippines come from Asian countries, followed by Canada and the United States.
The balikbayan box become popular in the 1980’s brought about by the influx of overseas Filipino workers in the United States. Two Filipino-owned freight forwarders were the first companies who offered balikbayan box services, REN International in Los Angeles, California founded by Rico Nunga in 1981 while Port Jersey Shipping International in New York City founded by Monet Ungco in 1982. They were the pioneers of door-to-door delivery boxes.
Back then balikbayan boxes were charged import duties upon arrival in the Philippines. But in recognition of the “magnitude of the contribution of the overseas contract workers whose lonely sacrifices in foreign lands bring in a considerable amount of foreign exchange annually,” the late President Corazon Aquino issued Executive Order No. 206 to amend the Tariff and Customs Code of the Philippines to make balikbayan boxes duty- and tax-free provided that it only contains non-commercial goods which value does not exceed $500 or P10,000. The tax exemption ceiling for balikbayan boxes remained unchanged until President Benigni Aquino signed the Customs Modernization Act (CMTA) in May 2016, increasing the tax-exemption ceiling from P10,000 to P150,000.
Changes in the regulation concerning the balikbayan boxes is about to be implemented by BoC effective August 1, 2017. BoC will begin enforcing the policy where “qualified Filipinos abroad” can send balikbayan boxes of up to three shipments in a calendar year and will be exempted from duties and taxes provided that its total value is not more than P150,000 and the goods are not in commercial quantities and are not intended for barter, sale or hire.
According to Customs Administrative Order (CAO) 05-2016, “qualified Filipinos” are those who are:
- Holders of valid passports issued by the Department of Foreign Affairs and certified by the Department of Labor and Employment or Philippine Overseas Employment Administration for overseas employment purposes regardless of profession;
- Non-resident Filipinos who have established permanent residency abroad but retained their Filipino citizenship; and,
- Resident Filipino citizens who temporarily stay abroad (may include holders of student visa, investors’ visa, tourist visa, and similar visas which allow them to establish temporary stay abroad).
On the other hand, Customs Memorandum Order 04-2017 signed on January 20, 2017 signed by BoC Commissioner Nicanor Faeldon on January 20, 2017 will implement stricter requirement to “balikbayan boxes,” the new rules that seek to promote transparency and prevent smuggling on imported items is also set to be implemented on August 1st. Among these changes are the following:
- The sending party is required to fill out a form with an itemized description of goods, including quantities and actual/estimated prices. However, if the sender is willing to pay duties and taxes for the goods being shipped, the sender is not required to fill out an information sheet.
- The sender has to itemize each shipment with corresponding prices to determine if the total amount is not over P150,000.
- When sending newly-purchased items that are worth more than P10,000 each, the sender must provide the necessary receipts as proof of purchase. Receipts are not required for used items, groceries, “gifts” and other goods that are worth less than P10,000.
- The sender will also need to provide photocopy of the page of their Philippine passport with personal information, picture and signature OR photocopy of their foreign passport with personal information, picture and signature plus proof of copy of dual citizenship.
- To qualify for the tax-free privilege, the sender can must send balikbayan boxes to family members or relatives up to fourth degree of affinity such as: the spouse, child, parent, sibling, sibling of parent, first cousin, niece/nephew, grandparent, sibling of grandparent, grandniece/nephew, grandchild, great-grandchild, or great-grandparent.
The sending party is required to complete 3 information sheets for each balikbayan box. The first copy is to be attached to the box, the second copy is given to the consolidator or freight forwarder while the third copy will be the sender’s copy. This Information Sheet for Consolidated Shipment of Balikbayan Boxes can be downloaded online or maybe obtained from the accredited consolidator or foreign freight movers.
In the recent post in the Bureau of Customs PH Facebook page, BoC Chief Commissioner Nicanor Faeldon clarified that in completing the declaration form/information sheet, the costs of the items need not to be precise, estimated cost are acceptable. For example, if thet-shirt included in the box was originally purchased at P500 and the shirt has been used, the sending party can declare it’s price as P100.
Commissioner Faeldon also clarified that there will no manual inspection of balikbayan boxes, the boxes will still undergo X-ray scanning and will only be opened in case suspicious items are detected after scanning.
Bureau of Customs website, retrieved July 26, 2017. www.customs.gov.ph
FW group hits Customs rules on balikbayan boxes, retrieved July 27, 2017. www.philstar.com
Tax-free balikbayan box policy starts August, retrieved July 27, 2017. www.news.abs-cbn.com
Things to know about balikbayan boxes, retrieved July 27, 2017. www.rappler.com
Balikbayan box, retrieved July 27, 2017. www.wikipedia.org
Balikbayan boxes, a part of Filipino tradition, retrieved July 27, 2017. www.cnnphilippines.com