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“Buwis niyo, Bayad niyo!”

ERC caves after protest against electric cooperatives' petition to pass on real property tax

Press Release
March 14, 2019

QUEZON CITY – Energy Regulatory Commission (ERC) suspended the jurisdictional hearing of the petition submitted by Philippine Rural Electric Cooperatives Association Inc. (Philreca) which seeks to pass on Real Property Tax (RPT) charges to consumers. This is after opposition from consumer and advocacy groups was expressed inside and outside the ERC office.

Organizations behind the Malinis at Murang Kuryente (MMK) Campaign rallied in front of the ERC, to urge the Commission to reject proposal of Philreca to add the tax on real property to the monthly bill of consumers nationwide. The petition follows the Supreme Court ruling that transformers, electric posts, transmission lines, insulators and electric meters are not exempted from RPT under the local government units (LGUs).

“In previous years, consumers have always been one with ECs to be recognized as tax-exempt just like any other cooperative, since they are supposed to be people's enterprises owned by the consumers they serve,” said Dr. Clint Pacana, Convenor of the Mindanao Coalition of Power Consumers (MCPC), President of the Institute for Power Sector Economics.

Pacana explained that Philreca, in filing the petition, abandoned consumer groups who are calling for the exemption of cooperatives from paying for real property tax. “While the consumers fight it out for their tax exemption, ECs want the easy way of passing on the burden to their supposed owners – the unfortunate consumers. We hope there is no collusion among local officials, ECs, and other distribution utilities (DUs) for this,” Dr. Pacana continued.

"All property owners pay amilyar (real property taxes) on what they own. Why do we also have to pay for what the coops own?”, Murang Kuryente Partylist Nominee and MMK Convenor Gerry Arances. Murang Kuryente Partylist filed a motion on behalf of its members and consumers nationwide for the ERC to dismiss the petition.

“Already, electric consumers are bearing the brunt of many ECs’ violation of system loss caps, mismanagement of financial liabilities, and the costly Power Supply Agreements (PSAs) with dirty energy generation companies. Meanwhile, many ECs are guilty of long and frequent interruptions in their respective franchises and failure to electrify areas within them,” he continued.