A joint memorandum circular (JMC) has been signed exempting eligible electric cooperatives (ECs) from local taxes, fees and charges.
The Department of Energy (DOE) and the Department of Finance (DOF) signed the JMC.
In a statement, the DOE said the new JMC will grant ECs registered with National Electrification Administration (NEA) or the Cooperative Development Authority local tax exemption upon compliance with financial and operational requirements.
“This local tax exemption is a significant milestone for our qualified ECs, as it directly translates to reduced financial burdens that can be reinvested into improving services and achieving 100 percent total electrification,” DOE Secretary Raphael Lotilla said.
An EC must secure an annual Certificate of Compliance from NEA to avail of the tax exemption.
ECs that can be granted with NEA’s certification must achieve at least a 75-percent rating of the compliance parameters.
“These parameters include maintaining high collection efficiency, achieving a positive net worth, meeting system reliability and system loss standards, conducting annual general membership assemblies and district elections as scheduled, implementing electrification projects to attain 100 percent customer connection, and submitting complete and timely reportorial requirements to the NEA,” the DOE said.
The NEA will issue the guidelines on the issuance of Certificate of Compliance 15 days from the effectivity of the JMC.
On the other hand, all ECs are still subject to pay administrative costs imposed by local government units in accordance with the JMC 2019-01 signed by the Department of the Interior and Local Government and the DOF.
These costs include fees for business permits, mayor’s permits, barangay clearances, community tax certificates, and other charges such as those for water consumption, electricity, and toll fees.
“By reducing these costs, we empower them to focus on expanding access to electricity, especially in unserved and underserved areas, ensuring no Filipino household is left behind,” Lotilla added.
