Kidapawan to lose 63% in real estate taxes due to EDC exemption

By Malu Cadelina-Manar | Friday| October 15, 2010 | 

KIDAPAWAN City (MindaNews/14 Oct) — Starting next year, the city government of Kidapawan will lose at least 63 percent in its real property taxes due to the exemption granted to the Energy Development Corporation (EDC), one of the country’s biggest renewable power producers.

The EDC, owner of the two biggest geothermal plants in the country, has been exempted from paying real property taxes amounting to P45 million.

City Mayor Rodolfo Gantuangco said such exemption will mean a significant reduction in the real property taxes to be collected by the city government next year, which will adversely affect many of its programs, the Special Education Fund (SEF) in particular.

Real property taxes fund the monthly honorariums of 189 teachers under the SEF, said Gantuangco.

The EDC used as basis in asking for tax exemption a provision in the Republic Act 9513 or the Renewable Energy Act, which took effect in 2009.

According to the law, as an incentive to producers of renewable energy, they would be granted an exemption in paying real property taxes. The payment instead will be treated as additional benefits for their workers.

At a meeting here last July, lawyers of the EDC reminded Gantuangco of the law.

To mitigate the adverse effects of the EDC tax exemption, the city government is set to lower the honorariums given to SEF teachers.

He said he has no plans of dismissing the SEF teachers as this will affect the quality of education, especially in far-flung villages where most teachers are assigned.

As a show of his dismay over the issue, the city mayor said he is not keen on endorsing the planned expansion of the EDC of its geothermal operations in Mount Apo. (Malu Cadeliña Manar / MindaNews)