Veco working on settling P200M in real property taxes owed to Cebu City gov’t

CEBU CITY, Philippines — The Visayan Electric Company (Veco) owes the Cebu City government over P200 million in real property taxes which covers unpaid and previously unassessed electrical posts, transformers and other machineries.

That is according to the assessment of the Cebu City Assessor’s Office. Veco, however, is working to settle these unpaid taxes.

In a text message to CDN Digital, Veco said that it was working closely with the city government to settle their RPTs. 

“As a responsible business entity and a trusted electric utility, Veco is working with the city government to resolve the payment of our real property taxes,” said Veco.

Veco also said it was also awaiting the ruling of the Energy Regulatory Commission on whether the real property taxes would be passed on to consumers.

Meanwhile, Lawyer Raul Bitoon, the City Assessor, said that Veco owed P73,881,656.81 on electrical posts and machineries which were already assessed in 1992 but has not yet been paid until the present.

The P73 million already included the annual fees for the last 26 years including the penalties. 

Bitoon said that Veco also owed the city on the newly assessed electrical posts and transformers which were not assessed since 1996.

Despite not being taxed for more than two decades, Bitoon said the city could collect only assessment value in the past 10 years prior to the first assessment in 2019.

The back taxes that Veco incurred for the newly assessed electrical posts and transformer for the last 10 years reached up to P121 million, on top of the real  value of these properties at P12 million, totalling to more than P134 million unpaid RPT.

In total, Bitoon said, Veco owed the city P208,155,959.66 on RPT from 1992 to 2019 over electrical posts, transformers, and other machineries.

Bitoon said that Veco would be given 60 days to contest the assessment. 

He said that this had been a recurring problem among the electric companies in the country as some of them argued that they were exempted from RPTs. 

However, as early as 2007, the Supreme Court already ruled in various cases that electric companies were not exempted from RPTs.

Bitoon said the collection of the taxes would depend on the new administration and the City Treasurer’s Office. 

He said that the city government could opt for a compromise payment method in which the LGU and Veco might agree on an exchange to lessen the value that Veco had to pay in taxes. 

He said that the decision would now lie with incoming Mayor Edgardo Labella. 

Read more: Labella to take oath as new mayor in front of Associate Justice

Labella, for his part, said that he would want a more efficient collection of RPTs and tax profiling. 

He said tax profiling would be necessary to avoid cases of unassessed properties such as that of Veco.

Labella said that RPTs would not include only the property itself but also any improvement done on the property. 

He said improvements on properties with taxes must be assessed as well and should be profiled properly. /dbs