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By Maricel V. Cruz, Reporter
Electricity consumers in the
franchise area of the Manila Electric Co. (Meralco) are paying for
value-added tax, which the utility firm is exempt from paying.
The Lopez-controlled Meralco
apparently has not been declaring that a large portion of the power
supply that it buys from the state-run National Power Corp. (Napocor)
and independent power producers, or IPPs, is spared from VAT.
The 14-page Napocor’s “Power
Bill” for Meralco, a copy of which was obtained by The Manila
Times, showed that the VAT being passed on to consumers by Meralco
is bloated, from 23 percent up to 39 percent that represents
billions of pesos collected from consumers every month to cover its
supposed VAT charges.
The document showed that an
average of 24 percent to 39 percent of the electricity supplied by
Napocor to Meralco is sourced from zero-VAT power plants that
utilize renewable energy sources.
The country’s biggest power
distributor, Meralco charges 12 percent across-the-board VAT without
making any distinction between a VAT-free and VAT-chargeable power
supply in the electric bills of its consumers, despite the cut in
VAT payments for its power supply from Napocor.
The 25-percent, zero-VAT rate
representing the total volume of electricity supplied by Napocor to
Meralco is outside of the other VAT-free electricity supplied by
other independent power producers to Meralco.
Napocor supplies 35.96 percent
out of the total amount of power requirement of Meralco, while 19.1
percent or roughly 2,154.8 megawatts are sourced from Lopez-owned
power plants, including the First General Hydro, a VAT-free rated
power plant.
Napocor billings to Meralco
showed that since December 2005, the government-owned power
corporation has started collecting 10-percent VAT from the utility
company. This charge became the basis of the VAT charges passed on
by the power distribution firm to its customers.
At the same time, however, the
10-percent VAT being charged by Napocor to Meralco does not cover
“FBHC, GRAM, ICERA and renewable energy portion of all other
charges.” Napocor’s December 6, 2005 “power bill” to Meralco
showed that of the total of 1,000 megawatts supplied by Napocor, 26
percent were “renewable” and, therefore, was free of VAT
charges.
On January 3, 2006, out of the
total of 1,050 megawatts also supplied by Napocor to Meralco, 26.69
percent were again renewable and VAT-free.
The document also showed that
from February 1, 2006 to July 10, 2006, during which Napocor started
charging 12-percent VAT, 24.03 percent up to as high as 39.09
percent of the monthly total of 1,050 megawatts supplied by Napocor
to Meralco came from renewable energy sources and were also not
covered by VAT.
The monthly inclusion of
“renewable” energy in the total volume of electricity supplied
by Napocor, however, did not have any impact on lowering the cost of
electricity that the utility company had been charging its
customers.
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