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Wednesday, June 15, 2005
Electric coop spared from P80M franchise tax payment
The Zamboanga City Electric Cooperative (Zamcelco) is spared from the payment of its franchise taxes to the City Government amounting to over P80 million, according to a recent legal advisory from the National Electrification Administration (NEA).
Zamcelco General Manager Reynerio Ramos said the NEA issued the advisory stating that all electric cooperatives in the country are deemed exempted from the payment of the franchise tax to the local government citing various provisions of existing laws.
These laws cited include provisions of Presidential Decree 269, Republic Act 9136 otherwise known as the Electric Power Industry Reform Act (Epira) law and the Local Government Code or RA 7160.
In an interview over Radyo ng Bayan the other day, Ramos said he has written Mayor Celso Lobregat, the City Council and Congressman Erbie Fabian informing about this development.
"We're (Zamcelco) still exempted (from the payment of taxes) in accordance with the legal advisory from the NEA," Ramos declared during the interview.
It is recalled that the city government has notified Zamcelco about the payment of franchise taxes amounting to over P80 million citing the ruling from the Supreme Court last year.
The Zamcelco has asked the city to condone the debt otherwise it would be forced to pass on the amount to the member consumers. In fact, the cooperative as well as other electric cooperatives in the country have filed for the grant of an automatic recovery mechanism with the Energy Regulatory Commission (ERC) but the same is still pending.
Ramos said the Zamcelco has not and could pay a single amount to the city government, as it is not included in the restructure system. "Our restructure system is regulated by the ERC".
In case it would be determined that indeed the cooperative will have to pay the franchise taxes, Zamcelco will be constrained to pass it on to the consumers but subject to the ERC authority.
Mayor Celso Lobregat in earlier interviews said that the city is not giving in to the request of the cooperative to condone the over P80 million debt in the form of taxes.
(June 15, 2005 issue)
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