WHEREAS,
the grantees of electric franchises are unable to reduce their rates
due to their high cost of operation; chanroblesvirtualawlibrary
WHEREAS, there is a need to proved electric current for light, heat and
power at a cost within the reach of consumers;chanroblesvirtualawlibrary
WHEREAS, assistance to the franchise holders by reducing some of their
tax and tariff obligations is imperative to attain the above objectives;chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution, do hereby
order and decree: chanroblesvirtualawlibrary
Section 1. Any provision of law or local ordinance to
the contrary notwithstanding, the franchise tax payable by all grantees
of franchises to generate, distribute and sell electric current for
light, heat and power shall be two (2%) of their gross receipts
received from the sale of electric current and from transactions
incident to the generation, distribution and sale of electric current.
Such franchise tax shall be payable to the Commissioner of Internal
Revenue or his duly authorized representative on or before the
twentieth day of the month following the end of each calendar quarter
or month as may be provided in the respective franchise or pertinent
municipal regulation and shall, any provision of the Local Tax Code or
any other law to the contrary notwithstanding, be in lieu of all taxes
and assessments of whatever nature imposed by any national or local
authority on earnings, receipts, income and privilege of generation,
distribution and sale of electric current.
Section 2. Tariff Heading No. 27.09 of Sec. 104 of
the Tariff and Customs Code, as amended, is hereby further amended as
follows: chanroblesvirtualawlibrary
Tariff
Heading Description of Articles
Rate of Duty
No.
27.09 Petroleum oils and oils
obtained from bituminous
minerals, crude.
(a) for use as fuel oils
for the generation
of electric power
imported by electric
utilities Ad Val. 10%
(b) Others Ad
Val. 20%
Section 3. Sec. 106 of the Tariff and Customs Code,
as amended, is further amending by inserting a new paragraph "b" and
relettering sub-paragraphs (b), (c), and (d), thereof to (c), (d), and
(e), respectively, the new paragraph (b) of the said Sec. 106 to read
as follows:cralaw:red
"b. On Petroleum Oils and Oils Obtained from
Bituminous Minerals, Crude Eventually Used for Generation of Electric
Power. — On petroleum oils and oils obtained from bituminous minerals,
crude oils imported by non-electric utilities sold, directly or
indirectly, in the same form or after processing, to electric utilities
for the generation of electric power, a refund or tax credit shall be
allowed not exceeding fifty per cent (50%) of the duty imposed by law
upon such oils, which shall be paid or credited under such rules and
regulations as may be prescribed by the Commissioner of Customs with
the approval of the Secretary of Finance."
Section 4. All the savings realized by electric
franchise holders from the reduction of the franchise tax under Section
1 and tariff reductions and tax credits under Sections 2 and 3, shall
be passed on to the ultimate consumer. The Secretary of Finance shall
promulgate rules and regulations and devise a reporting system to carry
out the provisions of this Decree. Violation of this section or the
regulations promulgated by the Secretary of Finance to implement it
shall be penalized by a fine of not more than P50,000.00 and
imprisonment of not more than six (6) months. In addition, the
Secretary of Finance may order compulsory price or rate reduction,
which may be either prospective or retroactive in application. If the
offense is committed by juridical person, the manager or person in
charge of the management of the business or affairs thereof shall be
responsible therefor.
Section 5. This Decree shall take effect immediately.
Done in the City of Manila,
this 11th day of September, in the year of Our Lord, nineteen hundred
and seventy-four.
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