Capitol tells Cebeco to pay P70M tax dues

The provincial government has pushed the Cebu Electric Cooperative I, II and III to settle its franchise tax dues, amounting to over P70-million inclusive of interests and surcharges, which accumulated from 1992 to last year.

Provincial treasurer Roy Salubre said Cebeco earlier refused to pay the franchise tax to Capitol contending that electric cooperatives were exempted from such tax. But in a similar case involving Laguna province, a court recently ruled otherwise.

Salubre said the Capitol has so far sent several notices or demand letters to Cebeco but the latter asked to put the dues on hold saying that it has a pending request at the Department of Energy to increase its power rates.

Salubre saw this as Cebeco's way to enable it to pay its tax dues to the provincial government but he said that the latter is willing to enter into a compromise agreement like what it had with the Visayan Electric Company last year.

In that compromise, Capitol agreed to condone 50 percent of VECO's interests and surcharges over its franchise tax dues, resulting in the reduction of VECO's dues from P29-million to P26-million.

In the case of Cebeco, Salubre said the amount due for collection-excluding interests and penalties-amount to about P55-million.

This amount alone, if paid, will surpass last year's P30-million franchise tax collection target, which the Capitol failed to meet by about 85 percent, said Salubre. - Cristina C. Birondo