The Benguet Electric Cooperative (BENECO) was able to secure from the Bureau of Internal Revenue (BIR) its certificate of tax exemption that will allow the electric cooperative to grant the exemption of the member-consumer-owners (MCOs) from the 12 percent value added tax (VAT) being charged to the distribution, supply and metering (DSM) component of their monthly power bills.
BENECO general manager Engr. Melchor S. Licoben said that management is now currently working with its finance officers on how to implement the VAT exemption that will be granted to the MCOs specifically in the DSM charge of their monthly power bills for them to enjoy the benefits granted by law to duly registered cooperatives.
He claimed that the implementation of the VAT exemption to qualified consumers should serve as a vehicle for others to pay their minimum capital share of PhP2,000 for them to enjoy the said privilege.
Earlier, CDA approved BENECO’s amended constitution and by-laws that paved the way for the latter to apply from the BIR the issuance of the requisite certificate of tax exemption that will allow the electric cooperative to implement the VAT exemption to the qualified consumers.
Initially, BENECO collected a minimum of PhP500 as capital share from the consumers but the results of last year’s annual general membership assembly showed the approval of the increase in the capital share to PhP2,000 supposedly payable in two years.
The BENECO official pointed out that since the BIR issued the required certificate of tax exemption, management is considering the reduction of the 2-year grace period to one year so that consumers will be able to enjoy the VAT exemption privilege at the earliest possible time.
According to him, last year’s general assembly also approved the proposal that the accumulated capital share will be exclusively invested to the electric cooperative’s renewable energy projects to help in the development of potential renewable energy sources within its franchise area and contribute in the ongoing efforts to lower the existing power rates being charged to the consumers.
BENECO has more than 144,000 registered accounts of its consumers in the Baguio and Benguet areas where more than 80 percent of the said consumers are from Baguio.
On the other hand, BENECO is also contemplating on granting an interest on capital share to those who fully paid their minimum capital share to serve as an incentive to the ones that already settled their share capital with the electric cooperative and that the same will be presented to the upcoming annual general membership assembly in strategic areas within its franchise area by June.
BENECO is among the 12 electric cooperatives that opted to register with the CDA out of the 121 electric cooperatives operating in the different parts of the country that are registered with the National electrification Administration (NEA).
Moreover, the electric cooperative was able to maintain its status as one of the top performing cooperatives in the country having regained its status as a Class AA and among those electric cooperatives that charge the cheapest power rate from its consumers through the years amidst the leadership impasse that it experienced over the past two years. By Dexter A. See
