DAVAO CITY – City hall officials are seeking a 70% share in the taxes for the Aboitiz owned 300-megawatt coal-fired power plant.

In his privileged speech Tuesday, Danilo Dayanghirang, chairman of the Committee on Finance, Ways and Means, and Appropriation said that the city should get more on top of the city’s automatic 30% share of the taxation of the P25-billion power plant as host of the power plant.

When it starts operating next year, business taxes from the power plant is estimated at Php 2 million, according to the Regional Development Council-XI. Other dues for the host communities also include a PhP 4.2 million due for community share, PhP3.5 million for government share, and P25.8 million for real property tax.

Dayanghirang said that “this is a very rare situation where one power plant is in the middle of two cities (sic). It is not written in any law or any reference material on what would be the basis for the sharing. We need to have a position and we need to have a basis.”

The power plant is located in Binugao, Toril and shares a boundary with Sta. Cruz municipality in Davao del Sur. Sixty percent of its equipment is located and is operating in Davao City while 40% in Sta. Cruz town. Eighty percent of the total land area of the project is located in Davao City.

“We had to have basis, there is now an emerging opinion from city hall that it has to be 30%-70%, in favor of Davao city,” said Dayanghirang.

The City Council approved the construction permit of the Aboitiz owned Therma South, Inc. (TSI) to build a 300 megawatt coal-fired power plant in 2011. In March this year, the city council again approved the expansion of the power plant to produce up to 656 megawatts.

Meanwhile, Manuel M. Orig, first vice president for Mindanao affairs of TSI, said the gross sales of the operation should be the basis of the tax share.

“The proposal was made by Sta. Cruz Municipal Mayor Ray Lopez which was presented to the LGU of Davao was 50-50 sharing,” Orig noted.

Orig said their company “will adhere to whatever sharing is to be decided by the city council or the city mayor.”

City Treasurer Rodrigo Riola, who is part of the negotiating panel of the coal-fired power plant tax sharing between the city and Sta. Cruz town said that as per latest discussion of the panel, Sta. Cruz should get 28% while Davao City gets 72% of the share.

“But up to now, there is still no final declaration as to what would be the tax sharing,” Riola said

Davao City’s 17th city council deferred its decision for the next session. (davaotoday.com)

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