DOTC won’t pay taxes for LRT, MRT stations

The Department of Transportation and Communications (DOTC) said yesterday it would not pay taxes to the Pasay City government for the operation of Light Rail Transit (LRT) and Metro Rail Transit (MRT) stations in the city.

Willie Trinidad, DOTC undersecretary for railways and mass transit, explained that the terminals are public service-oriented facilities so they cannot be taxed.

"It’s the public that benefits from the LRT and MRT. I don’t think we should pay taxes," Trinidad said.

The other day, Pasay City administrator Ernestina Carbajal said the Light Rail Transit Authority (LRTA) and the Metro Tail Transit Corp. (MRTC) owed the city government P400 million and P47 million in real property taxes, respectively. The taxes covered the LRT stations on EDSA extension, Libertad and Buendia and the MRT station on Taft Avenue.

The DOTC-attached LRTA operates the 18-year-old LRT while the MRTC is a private consortium that constructed the MRT under a build- lease-transfer scheme with the government. Under the scheme, the national government will have to pay MRTC for 25 years before it can acquire the MRT property.

Both rail systems are subsidized by the national government because the fares currently being charged are not enough to cover operational and maintenance expenses.

Trinidad said yesterday he had not been informed that the Pasay City government was demanding the payment of real property taxes.

"I have not been informed. Even if we were, we cannot pay taxes. We’ll take a stand similar to the Manila case," he explained.

The Manila City government had also demanded tax payment from the DOTC. The case reached a lower court, which later ruled in favor of the city government.

The DOTC, however, has appealed the case.

Trinidad explained that while the LRTA was created as a corporation under a law passed during the Marcos administration, it is the public that greatly benefits from the railway’s services.