MANILA, Philippines?The Supreme Court on Friday temporarily blocked the government from levying the 12-percent value-added tax (VAT) on all road tolls and from implementing a plan to raise by more than 250 percent the toll at the South Luzon Expressway (SLEx).
Court Administrator and Supreme Court spokesperson Midas Marquez said Chief Justice Renato Corona issued the two restraining orders because of the urgency of the situation that could cause ?irreparable damage? to the public using the highways.
The tax and toll increase, which were to start on Monday, were expected to raise more than P1 billion a year for the government which is trying to cut a budget deficit forecast to reach a record P325 billion this year.
Marquez noted that the high court will not be having its en banc session until Tuesday.
He said that if the high tribunal had not issued a TRO and then, after a review of the case, decides that the VAT was not properly imposed, ?it would be very difficult to refund the motorists.?
If the magistrates decide that the VAT was properly imposed, ?then we are more or less losing only a total of 10 days,? Marquez said.
?Of course, the Court knows this is an imposition of taxes and taxes are the lifeblood of government. Therefore, we are very careful in restraining the imposition of taxes. Then again, there are other equally important arguments and reasons that we have to take into consideration,? Marquez said.
Finance Secretary Cesar Purisima and Internal Revenue Commissioner Kim Henares were given 10 days to respond to the petition against the tollway tax filed by former Nueva Ecija Rep. Renato Diaz and former Trade Assistant Secretary Aurora Timbol.
Diaz and Timbol argued that the imposition of the VAT on the use of tollways was unconstitutional and ?an invasion of legislative powers.?
Form of tax
Others opposed to the tax, including lawmakers, argue that the toll is already a form of tax.
The Aquino government is seeking to impose the VAT on all tollways, including the North Luzon Expressway, the Subic-Clark-Tarlac Expressway, the Coastal Road, the elevated Skyway and the SLEx.
The TRO on the tax will remain in effect until the high court decides on the petition and the response from Purisima and Henares.
The order against the SLEx toll increase will also be indefinite although a decision is expected very soon on the case, said Marquez.
Marquez said that while the high court was already deliberating on the petitions against the toll hike, it issued a TRO because the increase was to take effect on Monday.
?Since a decision cannot be promulgated before Monday and we understand that on Monday the hikes on the toll will also be implemented, the Court is issuing the TRO to restrain the increase in the toll,? Marquez said.
He explained that the high court refrained from immediately issuing a TRO when the petition was first filed because it ?was under the impression that there was no urgency to issue a TRO? at the time.
?The Court is already deliberating on that case, so we expect a decision very soon,? Marquez added.
Those who filed petitions against the SLEx toll increase were Albay Gov. Jose Salceda, private lawyers Ernesto Francisco, Jr. and Jose Ma. Hizon, former House members Imee Marcos, Ronaldo Zamora, Quirino Marquez and Luis Asistio, and the Gising Kabataan Movement, among others.
The high court ordered that Salceda?s petition be consolidated with the other docketed cases.
Named respondents in the various suits were the transportation and communications secretary, the Toll Regulatory Board, Manila Toll Expressway Systems, South Luzon Tollway Corp., Philippine National Construction Corp., Manila North Tollways Corp., Benpres Holdings Corp., First Philippine Infrastructure Development Corp., Tollways Management Corp., MTD Manila Expressways, and the Citra Metro Manila Tollways Corp.
In their petition, Francisco and Hizon said that the toll increases allowed by the TRB were ?stupefying.?
?For instance, the increase in toll fee for private passenger vehicles amounts to P2.70 per kilometer. This represents a staggering 320-percent increase over the current P0.82 per kilometer,? they said.
In his separate petition, Salceda described the increase as ?abrupt, unconscionable, exorbitant and shocking.?
Before the Supreme Court issued the TROs yesterday, Francisco filed an ?extremely urgent omnibus motion? reiterating his petition for the court to restrain the toll increase.
Francisco also asked the high court to suspend the implementation of the Supplemental Toll Operation Agreement (Stoa) covering the SLEx, citing the need for an investigation because of alleged irregularities.
Marquez said the high court could no longer consider Francisco?s latest petition when it issued the TRO against the SLEx toll hike.
At the House of Representatives, Bayan Muna party-list member Teodoro Casiño filed House Resolution No. 212 calling on the Toll Regulatory Board (TRB) and the Southern Luzon Expressway (SLTC), the SLEx operator, to suspend the implementation of the toll increase pending a congressional investigation.
Eastern Samar Rep. Ben Evardone meanwhile said the high court restraining order should be made permanent.
?It?s good that the [Supreme Court] has heard the cry of the people. It?s very clear that the toll hike has no legal basis and is unjust. Unless the BIR and SLEx can justify it, the TRO should be made permanent,? Evardone said in a text message.
TRB spokesperson Julius Corpuz yesterday said the high court decision restraining the SLEx toll hike sends a negative message to potential foreign investors that may have wanted to participate in the public-private partnerships in infrastructure that President Aquino has espoused.
He said the delay in the implementation of the new rates would ultimately burden taxpayers because the Malaysian-backed SLTC will need to recover its investment, one way or the other.
?We will have to factor in the rights of the investors. Investors also have commitments to their creditors that they have to meet,? Corpuz said.
The SLTC was given a 30-year concession to operate SLEx, to expire in 2036. SLTC is authorized to collect toll to ensure that it gets a 17-percent return on investment every year.
The company was only allowed to collect toll at SLEx last April, after it completed the first two phases of its rehabilitation of the road.
Because of the many delays in the implementation of the new rate, SLTC has lost over P230 million in foregone revenues, according to the TRB. These losses will have to be repaid eventually, Corpuz said.
He said the government may even be forced to pay the investor outright.
SLTC president Isaac David said the deferment of the toll hike was ?bad news,? but noted that the company had no other choice but to comply. He declined to comment further, saying that the company had not yet received a copy of the court order. With Paolo G. Montecillo and Michael Lim Ubac