PNOC to sue two other GOCCs for dispute over P112-M tax liability, nonpayment of P70.8 loan.
By Ben Rosario
The Philippine National Oil Corporation has vowed to sue another state-run corporation, the Power Sector Assets and Liabilities Management (PSALM), to put an end to a long-standing dispute in the payment of P112.5 million output value added tax (VAT) on the sale of banked gas.
PNOC made the vow in response to Commission on Audit's call for the resolution of the issue that has affected its financial records.
In the recently-released 2018 PNOC annual audit report, COA also called on PNOC to file charges against the Natural Resources Development Corporation in connection with the latter's failure to pay P70.090 million loan that remained uncollected since 2009.
The NRDC is also a government corporation attached to the Department of Environment and Natural Resources.
COA reiterated its previous recommendation for PNOC to continue to "exert extra effort" in resolving which between PNOC and PSALM should pay for the output VAT from the sale.
PNOC responded by assuring that it will abide by the audit recommendation, adding that it will even "file appropriate charges against PSALM if warranted."
IN a deal for the sale of banked gas, the PSALM paid PNOC P928,480,920 of the total P1,050,402,657 of banked gas equivalent to 4,605 petajoules.
Not paid by PSALM is P112,543,142 representing the Output Value Added Tax.
Asked by editors to explain its failure to pay the total amount in the sale of banked gas, PSALM said it is not liable for the payment of the output VAT "since there is no provision stated in the purchase agreement" that requires it to pay for the tax, being the buyer.
PNOC, on the other hand, insisted that PSALM is liable to pay the output VAT.
The controversy continued with the two state-run firms rejecting each other's demand for payment of the tax.
The Office of the Secretary-General was also asked to step into the controversy to resolve the issue.
"The collectability of the receivables is doubtful and affects the fair presentation of balances of the account in the financial statements," COA said in its audit report.
State auditors of PNOC have to "continue to exert extra effort in resolving the issue"
"Loans Receivable from Natural Resources Development Corporation in the amount of P70 million remained uncollected for more than ten years," COA said in the same audit report.
The loans were extended by PNOC-Energy 'Development Corporation in two loan agreements entered into on separate occasions in 2004.
Totaling P55 million, the loans carried interest of six percent per annum.
In 2007, the PNOC-EDC, owing to the implementation of its privatization, issued a deed of assignment of interests and rights in NRDC in favor of PNOC.
COA noted that despite numerous demands for payment of the loans, the NRDC has failed to comply with its obligations.
To force collection of the loan, state auditors called on PNOC to file appropriate legal charges against NRDC.
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|Date:||Jun 17, 2019|
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