PECO pays Iloilo gov’t P135M to settle real property tax obligations

The Panay Electric Company Inc. (PECO) on Monday paid nearly P135 million to the City Government of Iloilo to settle the company's real property tax (RPT) obligations.

In a statement, PECO said it paid the local government unit a total of P134,927,522.63, which the company said represents all its past and present RPT liabilities from 2006 to 2019.

The amount, however, excludes interests and penalties that are still subject of a case before the Local Board of Assessment Appeals (LBAA).

According to PECO, the payment effectively averts the Iloilo LGU's planned auction of PECO's properties on December 12, to cover the RPT of the company.

"Now that PECO has paid the tax liabilities assessed by the city government of Iloilo, there is no more reason to proceed with the planned auction of the company's properties on December 12," said PECO head of public engagement and government affairs Marcelo Cacho.

PECO has been locked in a legal battle with MORE Electric and Power Corp. after the latter was granted a franchise to operate the electric distribution utility in Iloilo City.

This came at the heels of the expiration of the franchise of PECO, Iloilo City's sole power distributor. An application is now pending before Congress.

PECO has since asserted that the wholesale turnover of its assets to MORE by way of expropriation was unconstitutional.

"Since the start, PECO is determined to settle and pay all its tax liabilities to the LGU, as may be required by laws or ordinances," said Cacho.

"In fact, PECO is not just paying its taxes in full, the company is even pre-paying in advance the RPT due on December 31 and now we are clear of all tax liabilities," he added.

According to PECO, of the total amount, around P60 million constitutes the payment of the principal amount of the company's RPT obligations under the first LBAA case.

Meanwhile, P75 million constitutes the payment of RPT obligations unde the second LBAA case due to be paid until December 31.

"PECO never opposed the paying of new property taxes. We just wanted clarification on why suddenly we get slapped with an unfair ten-year back-tax assessment," said Cacho.

For his part, Iloilo City Mayor Jerry Treñas said the amount will be used to finance developments needed by the LGU.

"With this, we can property fund programs intended for much improved social services and other initiatives that would benefit the Ilonggo community in our quest to bringing Iloilo City to the next level," he was quoted as saying in the statement. — BM, GMA News