BIR confirms power grid paying franchise tax religiously —NGCP

By Malaya Business Insight – January 9, 2025

The National Grid Corporation of the Philippines (NGCP) said the Bureau of Internal Revenue (BIR) has confirmed the grid operator religiously pays the 3-percent franchise tax mandated by law.

NGCP in a statement said the confirmation was made by BIR Commissioner Romeo Lumagui Jr. during the hearing of the House Ways and Means Committee on Tuesday.

In the statement, NGCP cited Lumagui’s statement at the hearing, in which he assured the public the strict implementation of Energy Regulatory Commission Resolution No. 10 following the release of BIR Revenue Memorandum Circular 24-2024, which prohibits NGCP from passing the franchise tax to consumers.

According to NGCP, ERC chairperson Monalisa Dimalanta in the same hearing also reported the grid operator paid between P1.3 billion and P1.5 billion franchise tax every year.

It added Dimalanta stated the franchise tax paid between 2016 and 2022 by NGCP amounted to P21 billion.

At the hearing, Sergio Dagooc, APEC Partylist representative called on Congress to look into the legal accountabilities of former ERC commissioners who approved NGCP’s petition to pass on the 3-percent franchise tax to consumers, NGCP said.

It added that Dagooc maintained NGCP could not be blamed for this move as it only acted based on the ERC resolution issued in 2011.