Mopreco rejects payment of P1.3-M tax to prov’l gov’t

By Gina Dizon

BONTOC, Mountain Province -- The provincial government is set to collect  P1,362,933  representing  real  property taxes on  electric poles from the Mountain Province Electric  Coop. but the Mopreco general assembly on June 25 agreed to reject payment of said tax imposed on electric posts.

Provincial Treasurer Cawed Gamonnac said real property taxes  due from Mopreco are based on assessed values of the electric poles by the Provincial Assessor’s Office and made known to Mopreco on  final letter of demand June 1 this year.

Assistant Provincial Assessor Randy Tic-chap said assessment of the taxes due dates back in 1997 as forwarded by the municipality of Bontoc. 

This represents 784 electric posts be these wood, cement or steel located in the capital town. Tic-chap said the 2006 assessment has not been updated.  

Provincial Legal Officer Denver Lucaney said electric poles are classified as ‘machineries’ due for assessment and taxation under the Local Government Code.

The Local Government Code of 1991 provides that “transformers, electric posts, transmission lines, insulators, and electric meters fall within the new definition of ‘machineries’ deemed as real properties subject to real property tax.

 The Notice of Assessment from the Bontoc Assessment Office only covers electric poles which retroacts in 1997 less than 10 years prior to the date of initial assessment in 2006.

 Notice was issued twice to delinquent taxpayers including  National Food Authority (NFA), National Irrigation Authority (NIA) and MOPRECO by the Provincial Government early this year via publication by newspaper.

 Taxes due for collection are only the RPT of electric posts located in the capital town of Bontoc. Other municipalities have yet to compute their assessment of electric posts and other machineries of Mopreco in their respective territorial jurisdiction.  

 Mopreco General Manager Nicodemus Andawi said payment of taxes due is an added burden to Mopreco’s expenses on the government’s sitio electrification program where energy services reach houses located far from each other.

 There is no way that Mopreco can pay the taxes, Andawi said where electricity dues paid by consumers are heavily paid to generation and transmission costs aside from operational costs by Mopreco.

         ‘The most that can be done is to let consumers pay the taxes imposed’ he said during Mopreco’s general assembly. But this has to be approved by the Energy Regulatory Commission, he added.

ERC Resolution 20, Series of 2009, Section 4.6.1 provides that real properly taxes that are paid by the electric cooperatives are deemed part of their operating costs and allowed by ERC for recovery from all consumers.  

Should there be remedies for reducing the cost, Gamonnac said Mopreco has to pay first its dues  “pending protest.”

Lowering taxes due may be taken from penalties or surcharges, but not the standard rates, Lucaney said.

Though exemptions under the Local Government Code seems to be pessimistic with the ruling of Supreme Court First Division ruling dated August 5, 2015 in a case between Manila Electric Company (Meralco) and the City Assessor and City Treasurer of Lucena City which declared that transformers, electric posts, transmission lines, insulators, and electric meters of Meralco are not exempted from real property tax under the Local Government Code.

In the same development, P3 million pesos in real property taxes from delinquent taxpayers were up for collection by the  Provincial Treasury as of December 2015.

These include taxation on permanent or movable properties  found in the  jurisdiction of Bontoc namely  Globe  and Smart telecommunications, National Food Authority (NFA), National Irrigation Administration (NIA) aside from Mopreco, and other private individuals.