The Department of Finance (DOF) has confirmed that a proposed remittance tax in the United States could significantly impact Filipino families back home, even if only a portion of overseas Filipinos in the U.S. will be directly affected.
Citing a report from the DOF’s chief economist, Palace Press Officer Undersecretary Claire Castro said that out of the estimated 4.4 million Filipinos in the U.S., around 20%—or fewer than a million—may be subject to the tax if the bill is enacted.
The legislation, titled the “One Big Beautiful Bill Act,” was passed by the U.S. House of Representatives and seeks to impose a 3.5% tax on remittances sent by non-U.S. citizens, including green card holders and individuals on H1 working visas. If approved by the U.S. Senate and signed into law, the tax is set to take effect on January 1, 2026.
“Although 41% of remittances are routed through the U.S., this doesn’t mean all of it comes from Filipinos there, as many transfers are simply processed through U.S. banks,” Castro explained, reading from the DOF statement.
While the DOF estimates a relatively small economic impact—around $100 million out of the projected $36.5 billion in remittances for 2026—the blow to families dependent on these funds may be far greater.
If the tax pushes through, recipients in the Philippines would only receive $96.50 for every $100 sent. The DOF noted that nearly 90% of remittances are used for basic necessities like food and household expenses, based on a survey by the Bangko Sentral ng Pilipinas.
