Bilyonaryo - Business

Maynilad customers to receive rebates due to unauthorized imposition of franchise taxes

By Eileen Mencias
The Metropolitan Waterworks and Sewerage System (MWSS) has directed Maynilad Water Services Inc. to give rebates to affected west zone customers for charging local franchise taxes without its consent.
In a statement, MWSS chief regulator Patrick Lester Ty said there would be “minor corrections” in the water bills of Maynilad customers after the water firm was found to have imposed local franchise taxes from March to June without the agency’s approval.
Ty said Maynilad had petitioned the MWSS to impose the government tax consisting of the 2% national franchise tax and the actual local franchise tax rate of the different local government units instead of the 12% value added tax. Maynilad made its request after it received its franchise last December.
The MWSS monitored and evaluated the rates charged by Maynilad in its service areas and it saw that Maynilad has been charging customers in Muntinlupa, Las Pinas, Malabon, Valenzuela, and Quezon City the actual local franchise taxes as early as March when the MWSS Board of Trustees had yet to approve it.
MWSS, however, said Maynilad may have implemented the rates in good faith as the rates previously submitted and approved by the MWSS board were already outdated.
The rates were charged to customers without the prior recommendation of the regulatory office and subsequent approval of the MWSS board which is part of the process provided for under the law.
The MWSS board approved the changes in the rates only last June 2.
Aside from rebates to customers, the MWSS also ordered Maynilad to revert the rates of government tax charges in accordance with the rates approved by the MWSS board.