The labor group, Trade Union of the Philippines (TUCP), wants the government to help overseas Filipino workers (OFWs) in obtaining loans as funds for their dependants’ livelihood here in Philippines.

“Right now, many OFWs and their families find it difficult to obtain a credit facility here since they do not have a Philippine income tax return (ITR), or any other admissible document showing that they are earning,” former senator and TUCP secretary-general Ernesto Herrera stated.   

The TUCP asked the government to provide the OFWs with an acceptable “proof of personal income” that they can use for easy access to loans and freely engage in other financial transactions here.

According to the TUCP secretary-general, the OFWs are having a hard time obtaining the loans since they can’t present ITRs and other documentary proof of earnings which are usually the requirements to avail the loans.

“The lack of an ITR is clearly a practical issue faced by OFWs and their families in relation to their tax-exempt status. Many OFWs are even having problems getting housing loans because they are unable to readily prove income or establish their capability to incur any borrowing,” he emphasize.

Thus, as solution to this problem, Herrera said that the Philippine Overseas Employment Administration (POEA) since the agency handles the deployment of OFW, should produce a “verified personal income certificate” for them so that they can use it in transactions.

“This should not be difficult since POEA is supposed to be in constant touch with licensed recruiters that, in turn, deal routinely with employers or principals abroad,” Herrera said.

“The additional paperwork may entail some cost, but surely our OFWs, dubbed economic heroes because of their growing remittances, are more than entitled to the service,” he added.

Herrera also said that if the POEA hesitate to produce the verified personal income certificate for OFWs, the agency should be compelled to do so by Congress.

“Congress should require the POEA to produce the certificates in the context of passing new legislation that would expressly affirm the tax-exempt status of OFWs, insofar as their foreign earnings are concerned,” he said.

He also said that it would be possible to produce the document since the POEA is in constant touch with the licensed recruiters who deals with the employers or principals abroad.

The OFWs, like a non-resident citizen, are taxed only on their Philippine-sourced income, regardless of the period that they are outside the country. As tax-exempt individuals, they are not required to file a Philippine ITR, assuming they are fully exempt; that is, they did not earn any income here, on top of their foreign-sourced income.

Herrera also said that the additional time, effort and money that such an endeavor would entail should not be an issue since the beneficiaries would be OFWs, whose remittances have been acknowledged as among the factors that help keep the country's economy afloat.