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Sunday, May 22, 2005
5-minute power shutdown urged
By Jane Cadalig
BAGUIO CITY -- Electric utility consumers nationwide have been asked to put off electricity for five minutes on June 12 to protest the inclusion of electric cooperatives in the coverage of the value-added tax (VAT) bill.
The bill, which was passed by the lower House and the Senate on May 11, subjects the power sector to a 10 percent tax.
The Association of Philippine Electric Cooperatives (Apec), in a press conference Saturday, said the passage of the bill will adversely affect the 6.6 million electric coop consumers, saying the measure would also bring up power rates by 10 percent to 12 percent in the next two years.
They said Apec is among the 36 members of the House that voted no to the passage of the bill. A total of 145 solons approved the tax measure.
"The passage of the new VAT Law will impact negatively on the 6.6 million, mostly poor, rural households which own the 119 electric cooperatives. The effect of the VAT on electricity consumers is to bring up power rates by 10 percent this year, and by 12 percent next year, or an effective increase of 56-86 centavos per kilowatt-hour depending on the franchise area," said Edgar Valdez, one of the Apec representatives.
The party-list group criticized the exemption of large power corporations from paying franchise taxes. Such an exemption is provided for in the new VAT bill, they added.
"We see no reason why the large corporate utilities such as Meralco, Visayan Electric Corporation (Veco) and Davao Light and Power, who are earning billions of pesos a year, are exempted from paying franchise taxes while at the same time, the non-profit, poor rural electric coops are still subject to local franchise taxes," said Sunny Madamba, also an Apec representative.
"The call for a five-minute power shutdown at 7 p.m. on June 12 intends to put all these issues to the fore and to convince the administration that the untimely imposition of VAT on electric coops will only bring further suffering to the Filipino people," they added.
But Benguet Electric Cooperative general manager Gerardo Verzosa said the coop would not cut off power supply as this may invite damage suits against them.
"It is our obligation to make power available to all the consumers but we are one in encouraging them to participate in this undertaking by putting off the power in their respective households," Verzosa said.
(May 22, 2005 issue)
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