CALLING the sector a “sleeping giant” of potential investors in the Philippines, the chairman of the House Committee on Ways and Means has asked Internal Revenue Commissioner Caesar Dulay to allow overseas Filipino workers (OFWs) to apply for their Tax Identification Numbers (TINs) online and without the need for face-to-face transactions.
The requirement that taxpayer information must be verified by personal appearance in the Revenue District Offices (RDOs) leaves OFWs who are still abroad unable to open stock brokerage accounts without their TINs—and because getting a TIN requires personal appearance, they are practically locked out of the market, Albay Rep. Joey Sarte Salceda pointed out.
“OFWs are a sleeping giant among direct investors to the Philippines. OFWs invest some 28 billion in remittances to the Philippines. If only some 20 percent of that is additionally invested, you would increase our direct investments by around $5.6 billion. That is no number to miss,” he said.
Salceda wrote a letter to Dulay following the suggestion of MyTrade-Abacus Securities Corporation.
The economist-lawmaker said OFWs are sleeping giants among investors, who could satisfy the need for “a broad investor base” that he called “crucial for deepening our capital markets.”
Salceda added, every transaction that the stock investor makes is also subject to tax—earning the government much-needed funds for fiscal and economic recovery.”
Overseas Filipinos, he noted, “are the greatest untapped resource when it comes to deepening our capital markets. All it takes is opening the doors in the first place.”
In his letter, Salceda also requested Dulay “to supply the Committee [on Ways and Means] with the tax administration rules and regulations, if any, that prevent us from fully digitalizing the process.”
“May I also request that the Bureau consider agency issuances that would allow for full TIN registration,” Salceda said.
The senior lawmaker said the National Internal Revenue Code, as amended, and Section 236 (I) of the Code, which requires the TIN for every taxpayer, does not appear to require personal appearance.
“A fully-digital process for registering corporations has in fact already been adopted by the Securities and Exchange Commission [SEC],” Salceda told Dulay.
“Registration of Taxpayer Identification Number is the most basic step to ensuring that a taxpayer is able to pay taxes on his taxable activities. TINs are particularly crucial for small investors who seek to invest their money in the stock market. Overseas Filipino workers may be particularly interested in investing in Philippine stocks as a means for preparing for their return to the country and to secure the future of their family,” Salceda.