Wednesday, January 30, 2008 P18.5-million aid for Benguet, Bakun inked
LUZON Hydro Corporation (LHC) agreed to pay the Benguet Provincial Government more than P18 million as settlement of the real property tax dispute involving the company's power plant facilities in Bakun.
In a memorandum of agreement (MOA) executed between the Provincial Government, the municipality of Bakun and management of Luzon Hydro, the parties agreed that the power firm will extend financial assistance of P18,504,124.80 to the local governments, retroactive from year 2002.
The agreement, signed last January18, will be sent to the Central Board of Assessment Appeals (CBAA) to be considered by the agency in coming out with a decision regarding the tax dispute pending before the CBAA.
In return, the provincial and municipal governments agreed to waive their right to assess and collect real property taxes, related interest and penalties on the company's facilities for the years 2002 to 2015.
The LHC filed a protest on the 80 percent tax assessment against the company's weir, dessander and tunnel, which is now pending before the CBAA.
In signing the MOA, the local governments said there is a need to preserve the harmonious relationship among the province, the municipality and the LHC, as the local governments recognize the company's contribution to the development of the municipality and the province.
LHC will provide the financial assistance on a yearly basis of P1,321,723.20 each year.
The agreement emphasized LHC's financial assistance to the province and the Bakun Municipal Government is not an admission of its supposed tax liability to Benguet and Bakun.
The MOA was forwarded to the Provincial Board for the legislative body's appropriate action.
Under the agreement, the local legislative bodies should submit to LHC resolutions or ordinances approving the agreement and confirming the authority of the municipal mayor and governor to sign the MOA. (JC)
