CTA voids pole, electric meter taxes on CDO power firm

FILE: Court of Tax Appeals of the Philippines located at Agham Road, National Government Center, Diliman, Quezon City in Metro Manila. (Photo By Judgefloro – Own work, Public Domain)

MANILA – The Court of Tax Appeals (CTA) has voided the Cagayan de Oro City government’s move to impose pole rental and electric meter taxes on the Cagayan Electric Power and Light Co. (Cepalco).

In a Sept. 25 decision written by Associate Justice Maria Modesto San Pedro and made public Friday, the CTA’s Third Division ruled to cancel the local government’s move, saying it has no valid basis.

The Cagayan de Oro City government had issued an assessment for pole rental tax amounting to PHP39 million in 2014 along with an assessment for mayor’s permit fees of PHP152 million and deficiency taxes for “weights and measures” amounting to PHP333 million. The taxes covered the years 2003 to 2013.

The company then went to court insisting that the taxes are without basis. In the case of weights and measures, the company said there is no authority for the LGU to regulate license seal test and calibrate its electric meters.

The company also said the tax assessment is invalid as the local government unit, under the Local Government Code, can only assess said taxes up to five years from the time it became due.

The CTA, in its ruling, said there is no basis for the imposition of taxes on weights and measures on the company’s electric meters and pole rental taxes. It added that the mayor’s permit fees can be assessed only for the years 2009 to 2013.

Associate Justice Erlinda P. Uy and Ma. Belen Ringpis-Liban concurred.