COA tells MCIAA to look into PAL's VAT exemptions

The Commission on Audit has advised the Mactan Cebu International Airport Authority to coordinate with the Bureau of Internal Revenue to look into the claim made by the Philippine Airlines that it is exempted from the value-added tax.

The 2004 audit report on the MCIAA operations bared that the agency has P20.5 million collectibles from PAL as of last December. With PAL's continued refusal to pay the VAT to the MCIAA, its obligations rose to P20,508,342 last year from P18,290,387 in 2003.

On the other hand, COA also found out that the issue over the P2.4 million that was garnished from the MCIAA's bank accounts in favor of the lawyer of the MCIAA Employees Mutual Association remains unsolved.

The employees' lawyer had sought the amount for his successful defense in court of the MCIAA employees on their claims to collect government benefits.

MCIAA officials informed the state auditors that the Court of Appeals has ruled in their favor when it reversed the lower court's decision ordering for the garnishment of the P2.4 million as attorney's fee.

It was learned that the lawyer informed the lower court of his intention to file a petition for certiorari before the Supreme Court questioning the CA decision.

Meanwhile, the COA also learned that the MCIAA still continue giving a monthly P25,000 per diem to members of the MCIAA board which is against COA rules.

Section 3 of Administrative Order 103, which was issued on August 31, 2004, provides that "non full-time officials and employees, including members of their governing board, committees and commissions, should be granted only not more than P20,000."

The MCIAA board members are only required to convene twice a month. - Rene U. Borromeo