Bureau of Local Government Finance Opinion

March 1, 2001 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 2nd Indorsement Respectfully returned, thru the Provincial Assessor, Koronadal City, South Cotabato, to the Municipal Assessor, Tupi, same province, his within request for opinion/ruling concerning the taxability of the real properties owned by National Power Corporation (NPC) located in Barangay Kablon, same municipality. It appears that the abovementioned request is being made in view of the alleged request of Mr. Venusto D. Hamoy, Jr., Manager, Transco-Mindanao of National Power Corporation, Mindanao Regional Center, Iligan City, that the subject real properties be dropped from the "Taxable Roll" of real properties. In this connection, attention is invited to the 2nd Indorsement dated February 9, 1998, copy enclosed, of the Department of Finance (DOF), treating on a similar subject matter, which ruled, as follows: "On the basis of the foregoing provisions of the Code, it may be deduced that while the real property tax exemption enjoyed by NPC has been withdrawn starting January 1, 1992, the machineries and equipment of NPC which are actually, directly and exclusively used in the generation and transmission of electric power shall remain exempt. All other real properties of the Corporation, however, shall be subject to the payment of real property taxes. aIcTCS Similarly, therefore, if the subject real properties of NPC are machineries and equipment which are being actually, directly and exclusively used in the generation and transmission of electric power, the same should be declared exempt from the payment of real property taxes. All other real properties of the said Corporation however, should be declared taxable effective 1992, in line with the abovecited 2nd Indorsement of the DOF, and pursuant to the withdrawal of exemption provisions of the Local Government Code of 1991, R.A. No. 7160. Be guided accordingly. (SGD.) BENJAMIN A. GERONIMO Executive Director