BAYOMBONG, Nueva Vizcaya—The provincial government has issued a final demand notice to pressure an American power and irrigation firm and a Filipino-owned power transmission concessionaire to pay their real property tax delinquencies amounting to more than P2.3 billion.
The final demand notice shows that the California Energy-Casecnan Water and Energy Co., which operates the Casecnan Multi-Purpose Irrigation and Power Project in Alfonso Castañeda town, owes the province some P2.2 billion in RPT.
On the other hand, the National Grid Corporation of the Philippines, which operates, maintains and develops the country’s power grid and holds the 25-year concession contract to operate the country’s power transmission network, owes the province some P157 million in RPT.
“Their tax obligations in the province have long been overdue. This has necessitated the issuance of the final demand notice by the provincial treasurer’s office to collect their RPT delinquencies,” Gov. Ruth Padilla said.
The provincial chief executive said real property taxes are some of the major sources of local taxes in the province. “Our sound local taxes enable us to make more development projects for our fellow Novo Vizcayano,” Padilla added.
The CECWEC, however, has invoked Malacañang Executive Order 173 that temporarily stops power-producing companies from paying taxes to their host local government unit. EO 173 either reduces the value or condones the non-payment of real property tax by independent power firms.
The giant $580-million CMIPP is a hydroelectric facility composed of two impounding dams and a power plant, connected by a pair of 26-kilometer tunnels built under the Ramos administration to address the power crisis during the 1990s.
The CMIPP also diverts irrigation waters from Nueva Vizcaya and Quirino provinces to at least 200 hectares of farmlands in Central Luzon and western parts of Pangasinan and provides some 100 megawatts of electricity to augment the increasing power requirements of the Luzon grid.
On the other hand, NGCP, which said it has not received the final demand notice has cited Republic Act 9511, also known as the Franchise Law as their basis for non-payment of RPT to the province.
In a statement, NGCP has invoked Section 9 of RA 9511 which it said the law “expressly exempts” the grantee [such as NGCP], its successors or assigns because it is paying a franchise tax equivalent to 3 percent of all gross receipts derived by the grantee from its operations under this franchise.
NGCP has explained further that the said payment of NGCP’s franchise tax is “in lieu of income tax and any and all taxes, duties, fees and charges of any kind… and on properties used in connection with its franchise.”
Filipino-owned entities One Taipan Holding Corp.’s Monte Oro Grid Resources led by Sy and Pacific21’s Calaca High Power Corp. led by Coyiuto control the 60 percent stake in NGCP. The remaining 40 percent is held by State Grid Corp. of China (SGCC) as its technical partner.