No more OEC requirement for qualified Balik-Manggagawa

Qualified Overseas Filipino Workers, who are returning to the same employer or job site will no longer have to secure the overseas employment certificate requirement.

‘Balik-Manggagawa’ (BM) Overseas Filipino Workers (OFWs) are now exempted from oversees employment certificate (OEC) requirement and paying any processing fee.
The Philippine Overseas Employment Administration (POEA) said in a newly approved memorandum circular that the new policy was the government’s response to the clamor of OFWs for a simpler and more convenient procedure in processing employment documents.

The Governing Board of the POEA has approved the exemption in the issued GB Resolution No. 12, Series of 2016, under Memorandum Circular No. 06.

Under the POEA resolution, qualified ‘Balik-Manggagawa’ who will benefit from the exemption are those who are returning to the same employer and job site, therefore have existing records at the POEA database, and those who are hired through the Government Placement Branch.

However, not all OFWs are given the said exemption. First time OFWs, Visiting OFWs who will go back to the same employer but in a different job site, and Visiting OFWs who will go overseas to work for a new employer but still need to secure OEC documents.

Department of Labor and Employment (DOLE) Secretary Silvestre Bello III noted that the said initiative addresses the urgency to simplify procedures and requirements for fast, efficient processing of employment documents especially during peak seasons–Christmas season, holidays, and school graduations– where the volume of OFWs requesting for OEC escalates to about 5,000 to 7,000 workers per day.

According to Migrante International, around 6,000 OFWs leave the country daily. From the OEC alone, the government earns P65.7 billion or P180 million a day, from various processing fees and state exactions on OFWs.

Under former President Benigno Aquino III’s administration, the POEA has implemented the online processing of OEC through the Balik Manggagawa Online Processing System, which aims to provide a more convenient and faster processing of OEC or exit clearance to OFWs.

How to avail of this exemption
To qualify for the exemption, the BM worker shall register online using the BM Online Processing System prior to the scheduled date of return to employer. The worker also has to update his/her personal and employment particulars as may be applicable. The information that the worker will provide are stored in the POEA database and transmitted to the Bureau of Immigration (BI) to serve as reference for the Immigration officer who will validate if the worker is qualified for the exemption.

Those who will not be exempted from the requirement will be directed to the BM online webpage where they may register again and set an appointment with their preferred POEA center.

Those who will go to the BI counter at the airport without registering online, meanwhile, will be referred to the Labor Assistance Counter for evaluation.

Workers who are not exempted from getting the OEC during the time of registration will have to set an appointment with any POEA office or processing center.

The registration is free of charge and there is no need for an OEC if the worker is qualified for exemption.

Other exemptions
Throughout the years, several government agencies strived to improve and modernize their support systems for OFWs, including the DOLE, POEA, and the Bureau of Internal Revenue (BIR).

In 2015, DOLE announced that OFWs–as long as they are documented and are duly registered at the agencies concerned–are exempted from paying airport fees, travel taxes and documentary stamp taxes. This is pursuant to R.A. 8042, as amended by R.A., 10022.
Though the fees were integrated into the airline ticket price at the point of sale, OFWs will no longer pay the fees upon presentation of the OEC.

Meanwhile, in 2011 BIR reiterated the tax treatment of income earnings and money remittances of OFWs in Revenue Regulation No. 1-2011 signed in February 2011, and amended in part by Revenue Regulation No. 11-2012 issued in August 2012.

This also provides for the wage or income of an OFW arising out of his overseas employment to be exempted from income tax.

However, income earnings of OFWs from business activities or properties within the Philippines are still subject to Philippine income tax. That means, even if OFWs are abroad, as long as they receive income from sources within the Philippines, these incomes must be reported to the BIR and OFWs must pay appropriate taxes.

Before his term ended, former President Aquino also signed Republic Act No. 10863 or the Customs Modernization and Tariff Act,  which allows every OFW to send up to three P150,000-worth of tax and duty free balikbayan boxes every year, provided that the goods are not intended for sale, barter, hire, or other commercial purposes.

OFWs who have been out of the country for 10 years on the other hand, get a P350,000-tax exemption while those who have been overseas for at least 5 years are given tax and duty free personal and household effects worth P250,000. Meanwhile, Filipinos working abroad for less than 5 years can enjoy a P150,000-tax-free ceiling.