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Sunday, November 06, 2011

DILG clarifies memo on “Passing-through” fees

By: Rey Anthony Chiu 

TAGBILARAN CITY, Bohol, Nov 5 (PIA) – On the issue of illegally taxing inter-provincial transiting vehicles and fearing they might find themselves trapped in legal battles, Local Government Units have sought Department of Interior and Local Government (DILG) clarification on its recent memorandum which has effectively extinguished a local revenue resource. 

DILG memorandum circular No. 2015-151 has reiterated the prohibition on passing-through taxes and fees levied upon inter-provincial transport of goods and services, which has affected local pricing. 

The memorandum intends to prohibit double taxation and bans the collection of levies on regulatory fees from passengers in local ports and other taxes fees or charges when transporting goods and passengers, sources at the DILG explained. 
In a gathering of LGU chief executives and the media with Secretary Jesse Robredo in time for the 115th birth anniversary of Carlos P. Garcia, Loon Mayor Lloyd Peter Lopez aired his town’s concern over the loss of a good revenue source when DILG memorandum which the secretary signed last October 12. 

DILG memorandum circular deems these kind of levies illegal as these are beyond the scope of the taxing powers of the LGU. 

The memorandum however did not mention about LGUS collecting taxes and fees on the use of locally maintained roads by inter provincial transport of goods and passengers, Robredo hinted. 

Mayor Lopez, who stood as a self appointed representative of at least 6 towns operating municipal ports said they have been deprived of a revenue resource in exacting toll fees to repair and the gravel roads, which connect the port to the highway. 

Lopez stresses that the town spends an annual budget of P50 thousand to make the road passable. 

For this, he hinted that the town would be at a loss if they could not generate the funds needed to maintain such a crucial access road to the port. 

The same memorandum also ordered the immediate repeal of existing ordinances which come in the form of double taxation and instructs DILG Regional Directors to monitor compliance and report to the secretary any breaches so that appropriate administrative charges can be filed. 

Hinting that toll fees for the use of roads could be a different case as to the intent of the memorandum, Robredo advised that the towns look at specific provisions in the Local Government Code, which would allow the collection of toll fees. 

As long as it is legislated and goes through the process, the DILG said it may not be a problem. 

Still feeling the existing apprehension of local chief executives on the matter, Robredo then advised that LGUs write the DILG so that the agency can suggest to them the steps to do to avoid legal snags in their collecting of fees. (30)

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