[ Manila Bulletin Online ] May 23, 2008
By DEXTER A. SEE
Pangasinan, Benguet agree on equal share in national wealth tax
LA TRINIDAD, Benguet — Officials of this vegetable-producing province and nearby Pangasinan have forged an agreement on an equal sharing of the national wealth tax on the operations of the 345-megawatt San Roque Multi-purpose Dam (SRMDP).
The agreement of the provincial governments was considered to be in the best interest of the two provinces.
Under the agreement, the collection of the national wealth tax on the operations of the dam is to be divided equally. The collection is retroactive to 2001 when the dam started operations.
The agreement was based on the Local Government Code that provides for an equitable sharing of taxes collected from the use and development of the national wealth.
The San Roque power plant is located in the territorial jurisdictions of Pangasinan and Benguet, although the water source of the dam is the Agno River in Benguet.
However, the provincial government of Benguet is not still aware of how much it will receive as its share in the national wealth tax.
The expected amount, however, is believed to be substantial.
Because they are both host provinces, Benguet and Pangasinan are entitled to the proceeds of the national wealth tax.
Before the signing of the agreement which was concurred in by both provincial boards, both provinces agreed to settle the issue over percentage sharing.
The agreement strengthens both provinces’ position on the collection of their share in the national wealth tax.
But there is no arrangement yet on the share of the municipal governments and barangays affected by the operation of the power plant.
The Local Government Code provides that the host communities are entitled to 40 percent share in the national wealth taxes paid by companies utilizing, developing, and exploiting the country’s national wealth.
Of the share of the host communities, 45 percent goes to the province, 30 percent to the towns, and 25 percent to the affected barangays.
At present, the practice of companies utilizing and developing national wealth of a certain locality is that they fully pay the national wealth tax to the national government.
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