Hearing on LGU-imposed taxes on electric poles, wires, transformers set
Proponents for the exemption of real property taxes on electric poles, wires and transformers will officially present its case in a legislative investigation set next Tuesday.
Set to be conducted by the Committee on Economic Affairs and Investment, Third District Board Member Arthur Defensor Jr., committee chair will lead the investigation.
Up for resolution is the question as to whether real property taxes for every piece of pole, every unit of transformer and rolls of electric wires imposed by various Iloilo towns may be waived.
For Iloilo's biggest electric cooperative serving 15 towns, the government-imposed taxes are not only a little bit too much to bear. With the after-effects of Typhoon Frank still felt, Iloilo Electric Cooperative I (Ileco 1) general manager Wilfred Billena said the "imposition" came at a really bad time as well.
The SP body is the rightful "level," the appeal then went stating "...these taxes emanate from the august body."
"While we don't dispute the taxing powers of the LGUs, we wish to point out that this imposition came at a bad time where our member-consumers, who are also your constituents are reeling from the unbated increase of fuel and prime commodities," the letter went. "And in the case of our electric cooperative, the needed funds to restore power lines to their normal operation after devastation of the recent-typhoon. The move to tax our electric cooperative would certainly jeopardize the viability of the electric cooperatives and further exacerbate the financial woes of the member-consumers."
Further still, Billena wrote, any more expenditures from the cooperative's end such as payment of tax not will have serious implications in its operations.
Ileco 1 last sought a rate increase before the Energy Regulatory Commission (ERC) in 2003.
"Our electric cooperative or any other electric cooperative for that matter cannot absorb the amount without passing it as a rate increase because per our unbundled rate approved by the ERC last 2003, payment of tax was never included in the rate," Billena said.
And there were also issues on "small and lifeline consumers" that Ileco 1 serves at a lower cost, Billena added. Said consumers will be doubly affected by the tax as imposed on poles, wires and transformers.
"Lifeline consumers by the way are consumers who pay their consumption at a price that's even lower than the purchased power from our power source," he said. "The imposition of tax would simply derail the program of total electrification because we will now be contemplating on whether the tax imposed would be commensurate to a certain line extension especially in areas where the beneficiaries would be lifeline consumers… The concept had made possible the energization of all barangays in the province and some of its sitios or puroks although some of these extensions are not wise economic ventures."