Legarda: VAT Removal on System Loss is First Step for Fairer Electricity Bills

Senator Loren Legarda said that the Bureau of Internal Revenue’s (BIR) removal of value-added tax (VAT) on allowable system loss charges is a significant step towards fairer electricity bills. Legarda stated that this move comes months after she first brought the issue squarely into the Senate’s energy-crisis discussions and pushed for action before it became a broader public issue. The VAT removal marks a success for her advocacy. The measure aims to rationalize the electricity bills paid by consumers and could potentially ease the financial burden on the public. The high cost of electricity has been a long-standing issue in the Philippines, and this reform could be welcome news for consumers. Senator Legarda views the VAT removal as a first step towards further reforms, with expectations that efforts will continue to enhance the transparency of the electricity pricing system and strengthen consumer protection. System losses in the Philippine power system are often attributed to factors such as aging transmission grids and inefficient management, with the costs historically passed on to consumers. The removal of VAT on these losses could serve as an opportunity to re-examine how these costs are borne. Source: Inquirer NewsInfo