|
Thursday, February 24, 2005
Party-list group opposes VAT on coops
THE Association of Philippine Electric Cooperatives (Apec) party-list is opposed to a proposal pending in Congress to impose Value-Added Tax (VAT) on electric cooperatives, independent power producers (IPPs) and the National Power Corporation (Napocor).
The party-list, of which Benguet Electric Cooperative (Beneco) is a member, warned that this will lead to a triple-whammy of price increases for the more than six million households that are part of the electric cooperatives' franchise areas.
In a press statement, the Apec expressed that VAT, as a tax on consumption, will constitute a pass-on charge to member-consumers who are already affected by the ongoing rise in the prices of petroleum products and other basic commodities.
Moreover, since electric cooperatives are operating on a non-profit basis, the cooperatives have no other recourse but to pass on the VAT to their consumers in order to maintain their viability.
"The imposition of a 12 percent VAT on electric cooperatives would mean an increase in electricity rates ranging from 50 centavos per kilowatt-hour to 84 centavos per kilowatt-hour. Residential consumers with a 100 kilowatt-hour consumption of electricity will have to pay an additional P50 to P85 monthly," the Apec said.
The party-list also believes that the lifting of VAT exemptions of electric cooperatives would hamper the cooperatives' ability to light up the remaining 3,068 unenergized barangays mostly located in far-flung rural areas. This will further limit development in these areas for many more years to come.
On the other hand, imposing a VAT on IPPs and the Napocor will further compound the problems faced by electricity consumers nationwide. The government power generator and the IPPs will have to pass these additional charges to electric cooperatives like Beneco, which in turn, has no choice but to pass on the burden to the consumers.
In a related development, the House committee on cooperatives development chaired by Apec solon Ernesto Pablo called on authorities of the National Electrification Administration (NEA) and the Cooperatives Development Authority (CDA) to fast track the preparation of the guidelines on the registration of electric cooperatives with the CDA without converting into stock cooperatives.
Beneco general manager Gerardo Verzosa, who attended the committee hearing, said that registration with the CDA is the only means to relieve the electric cooperatives from paying taxes imposed by the local government units. (Ed Brillantes)
(February 24, 2005 issue)
Write letter to the editor.Click here.
Join the Sun.Star message board.Click here. |
|
[return to top]
[home]
[network page]
|
LOCAL NEWS
BUSINESS
OPINION
SPORTS
LIFESTYLE
FEATURE
|
