Bukidnon keen on collection of DMPI P105-M tax arrears

MALAYBALAY CITY – The provincial government of Bukidnon still did not sign or authorize a compromise deal with Del Monte Philippines, Inc. over the latter’s real property tax arrears, Jeffrey Sayson, provincial legal officer, told Bukidnon News recently.

Sayson, who was also provincial administrator until July 1, said if any negotiation exists, this will go through the provincial board, which passed on Wednesday  Resolution No. 2011-048 strongly recommending the implementation of the collection of the whole real property tax from 2006 to 2010 as assessed in March 2011. Former Malaybalay City councilor Provo Antipasado assumed on July 1 as the Capitol’s new administrator.

Lawyer Marco Parpan, DMPI plantation labor relations and legal services manager told Bukidnon News on July 9 that DMPI has submitted a letter to the Sangguniang Panlalawigan on July 8 (Friday) “asking for reconsideration or recall of the demand letter.”

Parpan declined when asked for details of the firm’s position. “Our position is articulated in the letter,” he added.

According to the Provincial Treasurer’s Office’s June 7, 2011 notice of distraint to DMPI, a copy of which was obtained by Bukidnon News Friday, the provincial government is collecting P105.23 million, the whole real property tax the firm owed to the provincial government from 1992 to 2010. Bukidnon News earlier reported that the firm owes P26 million, But Sayson said it was amount, which they computed as the tax
due for the last five years, if in case the firm seeks for a compromise.

The provincial board resolution recommended “appropriate remedies” for its collection if the same is not paid voluntarily on July 7. Board member Nemesio Beltran Jr. suggested garnishment against the firm. The Provincial Treasurer’s Office issued a 30-day notice of distraint to DMPI on June 7, which expires on July 7. Sayson said DMPI has the option to file a temporary restraining order in court or submit a compromise proposal to the provincial government.

As of July 1, Sayson said, no such proposal was sent. Bukidnon News has continued to try reaching DMPI but no comment was obtained as of July 7.

In the firm’s letter to the provincial government on June 23, 2010, the firm said they are exempt from paying the real property taxes as they don’t own the lands they are using. They said they leased it from the Del Monte Employees Agrarian Reform Beneficiaries Cooperative (DEARBC), who the provincial government should tax as the owner.

But they cited that the cooperative is also exempted from paying the real property, assessed as of June 2010 at P95.94 million.

“Under the Local Government Code and the new Cooperative Code of 2008, real properties owned by duly registered cooperatives such as DEARBC, are exempt from real property taxes,” DMPI said in the two-page letter signed by Luis F. Alejandro, general manager and chief operations officer.

DMPI quoted the Cooperative Code of 2008 as saying that cooperatives with accumulated reserves and undivided net savings of not more than P10 million from “all national, city, provincial, municipal, or barangay taxes of whatever name or nature.”

The firm showed that DEARBC only has P2.81 million accumulated reserve fund, thus exempted.

DMPI even cited then that the Department of Finance – Bureau of Local Government Finance (BOF-BLGF) affirmed the firm’s position that they are tax exempt.

Sayson stressed, however, that the provincial government is asserting collection based on the beneficial use principle. He said Supreme Court decisions invoke the principle of collecting tax from the one who is actually using the land, in this case DMPI, not the DEARBC.

Sayson added that the province, however, is not keen on going to court that is why the computation of P26 million emerged. He said prescription rule of coverage for collection of real property tax allows only five years.

“It (P26 million) could be the compromise tax the provincial government can accept based on the law,” he added.

But Sayson said DMPI must first admit their tax liability so they can work on the negotiations. He said DMPI might still cling on to its tax-exempt position.

He added that the P8 million alleged compromise tax due emerged after the present DMPI management allegedly inquired about the tax due in the last two years.

Sayson admitted it was a quote in response to the inquiry, not a tax compromise as no such process exists as of July 1.

Roger Guillermo, of the Provincial Treasurer’s Office, was summoned to the Sangguniang Panlalawigan last week to clarify on the firm’s tax arrears from 2006 to 2010 when Vice Gov. Jose Ma. R. Zubiri Jr. told the provincial board of an alleged negotiation with the Capitol.

Guillermo said the treasurer’s office has already issued a notice of distraint or a levy on tax debt covering personal and movable assets of the company.

Zubiri said the firm allegedly negotiated to pay only for two years at P8 million. He cited that Gov. Alex Calingasan allegedly informed him about it in a text message earlier, prompting him to ask the position of the other members of the board.

Board member Jay Albarece told Bukidnon News that Guillermo admitted that the tax arrears were under negotiation. Zubiri told Newswatch before leaving the session on June 29 that the provincial government may waive interests and penalties but not the net of a tax due. (Walter I.Balane).

Find this story also in www.mindanews.com

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