LGUs urged to provide tax relief to power firms

Danessa Rivera April 19, 2020 - 12:00am
https://www.philstar.com/business/2020/04/19/2008160/lgus-urged-provide-tax-relief-power-firms

MANILA, Philippines — The Department of Energy (DOE) is urging local government units (LGUs) to give energy companies a grace period for paying taxes and other fees amid the extended enhanced community quarantine.

The DOE earlier issued an advisory giving consumers grace period to pay their bills falling due during the original and extended quarantine without interest, penalties, fees and charges.

It said the accumulated electricity bills falling due during the quarantine should be payable in four equal installments after the quarantine period.

The Energy Regulatory Commission (ERC) had also issued guidelines directing distribution utilities (DUs) and retail electricity suppliers (RES) to defer customer electricity bills falling due within March 16 to April 30.

DOE also allowed all public and private corporations in the power sector to be given the same grace period without interest, penalties, fees and charges for all obligations falling due during the original and extended quarantine.

These include payments due to the National Power Corp., the National Transmission Corp., the National Grid Corp. of the Philippines, and the Power Sector Assets and Liabilities Management Corp., fuel/resource suppliers of generating facilities including coal, oil, steam supply and natural gas, Independent Power Producers, and Independent Electricity Market Operator of the Philippines.

However, the DOE said the same grace period should also be provided by LGUs to energy industry players.

“The DOE earnestly seeks the consideration of all local government units, to allow a similar grace period and other related mechanisms in the collection of applicable taxes, fees and dues from energy facilities in their respective jurisdictions,” it said.

Meanwhile, the PhilippineRural Electric Cooperatives Association Inc. has appealed for an extension on payments and remittances falling due beyond the quarantine period.

Philreca, the umbrella group for 121 ECs nationwide, said the quarantine in Luzon and in almost all provinces have led to a significant decline in electricity demand and consumption due to closure of schools, offices, establishments, and businesses.

The group has asked for “humanitarian considerations” to adjust or lift rules on minimum contracted capacity and other fixed costs such as capital recovery fee and minimum energy off-take charges in the power supply agreements (PSAs).

The group also appealed to be given a payment discount even with staggered payment schemes.