Napocor owes Zambales towns P619M in taxes

IBA, ZAMBALES—The National Power Corp. (Napocor) has yet to pay P619.5 million worth of taxes to the Zambales and Iba municipal governments, and local officials fear the dispute could derail the privatization of the 600-megawatt Masinloc Coal Fired Thermal Power Plant (MCFTPP).

Joey Dolojan, consultant to the Office of the Governor, said Napocor has not been paying taxes to the provincial and local governments for the past five years, delaying the supposed takeover of the Masinloc Power Partners Co. Ltd (MPPCL) next month.

Part of Napocor debt represents six years of unpaid franchise tax covering 2002 to 2007 estimated at P240 million while business tax dues imposed by the Masinloc local government has a total cost of at least P379.5 million from 1999, Dolojan said.

He said the Napocor tax dues were brought up during the actual on-site inventory by his group, the MPPCL, and the Power Sector Assets and Liabilities Management Corp. (PSALM) last month.

He said the Applied Engineering System (AES) found in that inventory that one of the plant’s generating units was not functioning.

The MPPCL is a subsidiary company of AES, a multinational company based in Arlington, Virginia in the United States that won the bidding for the Masinloc coal plant for $930 million on July 26 this year.

Nilo Madrid, Masinloc plant manager, said the Napocor would await court suits from local governments over the taxes.

Citing the Electric Power Industry Reform Act (Epira), Madrid said Napocor is relieved from all tax dues it owed local governments.

“They can go to court if they want to,” he added. Inquirer Central Luzon