Gov’t loses P7.4B annually due to NGCP tax exemptions – Hontiveros
MANILA, Philippines — Sen. Risa Hontiveros on Monday claimed that the government had been losing P7.4 billion every year due to the tax exemptions given to the National Grid Corp. of the Philippines (NGCP).
Hontiveros made the remark as she called for a security audit of the national grid system and a legislative inquiry into the operations of the NGCP.
Citing financial data, Hontiveros lamented how the government had been losing money while the NGCP “as a natural monopoly is raking in the profits.”
“As of 2018, NGCP has regained its estimated P180-billion investment from the profits of the transmission business. Yet there are still 15 years left in the 25-year lifespan of the concession agreement,” she said, speaking partly in Filipino.
This contract, she pointed out, would still be renewable for another 25 years.
“Aside from these, NGCP enjoys tax exemption privileges granted by its franchise. The government has foregone tax revenues of around P7.4 billion annually because of this exemption,” she added.
According to her, before the privatization of the power transmission business, state-owned National Transmission Corp. (Transco) used to pay P9.5 billion in taxes.
Today, however, NGCP only pays P2.2 billion in taxes.
“That’s why, even though have not completed paying the concession fee, which according to the concession agreement should be paid in installments, they have already regained their investment,” Hontiveros said.
The NGCP is a private firm, created in 2009 through the Republic Act No. 9511, which is tasked to operate, maintain, and develop the country’s state-owned power grid.
It is a consortium of three corporations — namely, Monte Oro Grid Resources Corporation, Calaca High Power Corp., and the State Grid Corp. of China.
