Study Proposes to Tax OFW Remittances

[rabbaddal]

FYI...

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Study proposes taxing OFW income
By Doris Dumlao
Inquirer
Posted date: April 11, 2007

MANILA, Philippines -- The government should tax income remittances from overseas Filipino workers (OFWs) and use the proceeds to shore up the productivity of workers left behind, a study by De La Salle University’s business and economics experts has proposed.

The research, titled “The Economic Impacts of International Migration: A Case Study on the Philippines,” written by Tereso Tullao, Michael Angelo Cortez and Edward See, said: “The possibility of increasing and internalizing the cost of international migration may be considered to reduce the economic ills it has generated. Such a move can arrest the possible hollowing effects on industries and mitigate the loss in international competition.”

The study suggested that these same remittance incomes pouring into the country had nurtured dependence, contributed indirectly to the contraction of industries and developed a culture of migration among Filipinos.

One way of compensating the country for the loss of migrants who attended government-funded state universities and colleges, the study said, would be to oblige them to compensate for the cost of their education.

“Another option is to impose some form of exit tax on migrating workers like nurses whose massive exit has affected nursing education as well as the health sector of the country,” said the study, which was presented during a recent international forum on labor migration conducted by the National Economic and Development Authority.

It acknowledged that the huge amount of remittances sent by OFWs as captured in official central bank statistics and a substantial amount unaccounted for that flows through the various informal channels had contributed significantly to the growth and stability of the national economy in recent years. But instead of alleviating unemployment, it argued that international migration has reduced the demand and supply of labor.

“International migration has increased the reservation wage of individuals coming from households with remittance income,” the research said.

The study also said that temporary overseas employment had the potential of depressing domestic industries and contracting employment similar to the consequence of the “Dutch disease,” referring to a situation in which dependence on a natural resource could erode competitiveness.

“The phenomenon of international migration, more particularly, temporary overseas employment, has also reduced self-reliance among individual members of the households. This has been shown in the long-term consumption pattern of households,” the research said.

It added that the reduced labor force participation of family members with remittance income can be interpreted as another manifestation of dependence.

[kel1guy]

Originally Posted by rabbaddal

FYI...

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Study proposes taxing OFW income
By Doris Dumlao
Inquirer
Posted date: April 11, 2007

MANILA, Philippines -- The government should tax income remittances from overseas Filipino workers (OFWs) and use the proceeds to shore up the productivity of workers left behind, a study by De La Salle University’s business and economics experts has proposed.

The research, titled “The Economic Impacts of International Migration: A Case Study on the Philippines,” written by Tereso Tullao, Michael Angelo Cortez and Edward See, said: “The possibility of increasing and internalizing the cost of international migration may be considered to reduce the economic ills it has generated. Such a move can arrest the possible hollowing effects on industries and mitigate the loss in international competition.”

The study suggested that these same remittance incomes pouring into the country had nurtured dependence, contributed indirectly to the contraction of industries and developed a culture of migration among Filipinos.

One way of compensating the country for the loss of migrants who attended government-funded state universities and colleges, the study said, would be to oblige them to compensate for the cost of their education.

“Another option is to impose some form of exit tax on migrating workers like nurses whose massive exit has affected nursing education as well as the health sector of the country,” said the study, which was presented during a recent international forum on labor migration conducted by the National Economic and Development Authority.

It acknowledged that the huge amount of remittances sent by OFWs as captured in official central bank statistics and a substantial amount unaccounted for that flows through the various informal channels had contributed significantly to the growth and stability of the national economy in recent years. But instead of alleviating unemployment, it argued that international migration has reduced the demand and supply of labor.

“International migration has increased the reservation wage of individuals coming from households with remittance income,” the research said.

The study also said that temporary overseas employment had the potential of depressing domestic industries and contracting employment similar to the consequence of the “Dutch disease,” referring to a situation in which dependence on a natural resource could erode competitiveness.

“The phenomenon of international migration, more particularly, temporary overseas employment, has also reduced self-reliance among individual members of the households. This has been shown in the long-term consumption pattern of households,” the research said.

It added that the reduced labor force participation of family members with remittance income can be interpreted as another manifestation of dependence.

The concept sounds nice and it would provide some revenues for wealth "REDISTRIBUTION." The real result will be that OFWs won't send nearly as many remittances due end result of less money to the families they are sending the money too. Not only that, this would result in taxes on all international electronic funds transfers.
This is not a realistic study. The peso is strong now due to OFW remittances and the commitment of the current administration to pay down the country's' foreign debt at the expense of many in country unfunded liabilities. Some examples the 2006 budget funded at 2005 levels vs the increases that should have been approved. The pension programs that are occasionally funded vs being permanently incorporated into each FY budget. The list goes on and on. By implementing this tax it would result in the currently all mighty peso making the trek once again over P 50 / USD. Hurry and implement it! See if less is really more......!

[Dunedain]

Originally Posted by kel1guy

The concept sounds nice and it would provide some revenues for wealth "REDISTRIBUTION." The real result will be that OFWs won't send nearly as many remittances due end result of less money to the families they are sending the money too. Not only that, this would result in taxes on all international electronic funds transfers.
This is not a realistic study. The peso is strong now due to OFW remittances and the commitment of the current administration to pay down the country's' foreign debt at the expense of many in country unfunded liabilities. Some examples the 2006 budget funded at 2005 levels vs the increases that should have been approved. The pension programs that are occasionally funded vs being permanently incorporated into each FY budget. The list goes on and on. By implementing this tax it would result in the currently all mighty peso making the trek once again over P 50 / USD. Hurry and implement it! See if less is really more......!

Politicians don't really give a rat's arse to those sending or receiving the remittance. All they care about is getting a huge chunk of it as much as they can for themselves. If they really cared about those left behind waiting for money from their kins sacrificing themselves, they wouldn't impose another tax.

[Tifosi]

Why kill the goose that lays the golden eggs? It's like their biting off the hand/s that feed them di ba?

But I think the study doesn't impose taxation on remmitances per se, but more of impose a tax on the exit of badly-needed professionals like doctors and nurses.

[the_BuGs]

langyang lasalistang mga to oo.... hindi pa ba sapat yung kinikita ng mga remittancess ng mga OFW's... ok lang naman mag tax ng mag tax basta ba may napupuntahan yung pera... eh kaso ang laki na ng tax ng binabayaran ng mga Pilipino tapos may E-VAT pa... tsk tsk tsk tsk tsk

[renz]

tama ka bugs.. ayos lang i tax kaming mga ofw basta ba ang pupuntahan nito ay ayos lang at hindi nanakawin nina ate glue.

at kung sakaling magka problema ang isang ofw sa ibang bansa.. dapat ayos na ayos din ang serbisyo.

pero teka, hindi pa ba sapat ang binabayad naming higit isang libo tuwing uwi namin? dami nun. asan na pala pondo namin sa owwa? di ba ginamit sa election philhealth ni gloria? naknampatung duling.

[bucks 'n bogut]

sinabi nyo na lang sanang bawal mangibang bayan para makaginhawa naman sa buhay ang pilipino!

may nalalaman pa kayong case study the fact that its a case of another talangkanism metality!

the whole thought of the research is saying na wag na lang tayong mangibang bansa, that for whatever reason, it became a threat to them

One way of compensating the country for the loss of migrants who attended government-funded state universities and colleges, the study said, would be to oblige them to compensate for the cost of their education.

pakialam ba nila? i bet marami sa kanila ay pumasok din sa public high school or elemnetary. and there's a tax in everything we buy, we gave so much already..

perhaps, they should rather do a research on how to remind the officials to slow down on public funds in order to compensate the cost of their corruption in the government!


kung wala silang matinong maiisip eh mag-isip uli sila mga *****!

OFW pinagti tripan nyo when they're the ones who's lifting the economy tsk tsk

case study kayo dyan, seems you didnt know or refuse to know what is pinoy life. i tell you, books alone will never save you. go out and multiply este mix up wiht different people

[parvus1202]

Mukhang communism ito a. Pasalamat sila dito dinadala pera, gusto pa nila makakuha ng tax. E nakunan na nga ng tax yan dun sa bansang pinagtatrabahuhan tapos tax ulit pag pinadala, ano pa natira? Mga komunista alang magawang magaling.

[Htjaen]

Correct!! As if hindi pa enough yung tax na binabayaran ng mga OFW's sa bansang pinag trarabahuhan nila. Even though some countries tax free naman.

It would really be like killing the goose that lays the golden eggs.

[cashwriters]

Originally Posted by Tifosi

Why kill the goose that lays the golden eggs? It's like their biting off the hand/s that feed them di ba?

But I think the study doesn't impose taxation on remmitances per se, but more of impose a tax on the exit of badly-needed professionals like doctors and nurses.

Good point. But the Philippines ALWAYS does this. They LOVE to squelch business through: minimum wage laws, labor laws, and employment regulations. End result--less taxes, less employment, worse economy.

[kel1guy]

cashwriters Well said in so few words! "Status Quo"

[etxetera]

Kung sana ay nakikita ng tao ang pinupuntahan ng tax ...

[greenwitch]

To the threadstarter: what's YOUR opinion about this?

[the_BuGs]

baka nauubasan na ng mga empleyado ang mga mayayaman...

[altair]

your opinions don't mean sh_it

so

stop remitting money.

send consumables (instant nongshim 농심 ramyon 라면, anyone?)

let the government tank

then they will see the raw and naked power of the new class of Filipinos -> hardworking, smart, tired of the bullsh_it of the Philippine elite, overseas

there is hope
in a hundred years, the Philippines shall be great again

[jisc]

di pa ba malaking sakripisyo yung malayo sa pamilya ang mga OFW? alam ba ng lasalistang ito kung gano kasakit sa OFW na pag uwi nila eh hindi sya kilala ng anak nya?

[cla_cbe_d_best]

^^ that's off tanget..

i'm also disappointed with those lasallians (from cbe pa naman).

dapat ayusin nila ang tax collection at gamutin muna ang graft and corruption bago magtax ng magtax.

[Juan_Tamad]

Why try to kill the goose that lays the golden egg?

And Exit TAX? That's going to be another restrictive and prohibitive red tape. A lot of our kababayans only borrow money to be used for proccesing and other requirements why add up another burden? As if these migrant workers have real options of just staying here and working here inside the country.

[kel1guy]

Originally Posted by Juan_Tamad

Why try to kill the goose that lays the golden egg?

And Exit TAX? That's going to be another restrictive and prohibitive red tape. A lot of our kababayans only borrow money to be used for proccesing and other requirements why add up another burden? As if these migrant workers have real options of just staying here and working here inside the country.

Whats next... A tax on sex between married persons? They need to plug the money holes from all of the leaking budgets first! Where is that study? Stay here and work? It costs as much to go to work Pasahe, & food, SS, income tax and VAT Tax... P259 a day minus P60 jeep, P 80 food, drink, snacks ect, minus payroll taxes and minus SS P35 equals actual take home P 84, then have to feed the family.... Right! Lets add "MORE" taxes rather than fix the problems of low wages, corrupt Government that is doing you a favor to serve you, (tong Please, before we do anything!) unfit drinking water, untreated sewage and the like!

[Dunedain]

It won't be long when another Pinoy will propose taxes for being Pinoy even if they of different legal citizenship (by birth or sworn in), and tax as well those who are half-Pinoys and/or non-Pinoys for eating adobo and/or wearing tsinelas.