LONE power distributor Panay Electric Company (Peco) owes the Iloilo City Government a collectible P44,618,396 in real property taxes covering the period 2006 to 2016.
The announcement was made by Zonida Aguilos of the city treasurer’s office based in partial assessment by the city assessor’s office made in 2013 of the 10,733 electrical posts made of wood, steel, and concrete dotting the main streets and 180 villages of the city.
The assessor’s office is currently conducting its field verification and inventory of the Peco electrical posts and other machineries considered to fall under the taxable real property.
The partial report on the number of electrical posts is expected to increase by 2015-2016 and this means the collectible amount may also increase in almost 11 years.
Aguilos said during a consultation meeting held by the City Council committee on energy and utilities on Tuesday, September 27, that the City Government already sent a demand letter to Peco in 2013 but the power distribution firm said their electrical posts are not taxable.
In 2014, another demand letter was sent to Peco but the firm failed to answer.
Last September 15, the City Government particularly the city treasurer’s office sent another demand letter on the payment of real property taxes.
The Republic Act 7116 or the Local Government Code of 1991 defines “Machinery” as machines, equipment, mechanical contrivances, instruments, appliances or apparatus which may or may not be attached, permanently or temporarily, to the real property that needs to be paid in real property taxes to LGU.
Pursuant to the recent Supreme Court decision, the following facilities such as transformers, electric posts or poles, transmission lines, insulators and electric meters, may qualify as “Machinery” and are not exempted from the payment of real property tax under the Local Government Code.
Peco is engaged in power distribution in Iloilo City and owns the electric posts which cable and television companies also paid rent as their transmission lines.