VAT on system loss may be removed by November – ERC

Philippine Daily InquirerIndependentCenternow

The Energy Regulatory Commission (ERC) in the Philippines has indicated that the removal of the value-added tax (VAT) on system loss charges, which are widely considered unpopular by electricity distributors, may take effect as early as next month. ERC Chairperson Francis Saturnino Juan made this announcement during a congressional budget hearing. He mentioned that the ERC had already issued Resolution No. 26 regarding this matter. The proposed change aims to alleviate financial burdens on electricity distributors while potentially impacting consumers through reduced taxes.

Bias read (Center): The article presents information about a regulatory decision related to taxation and energy policy without overtly favoring any particular political ideology. It focuses on the statement from the ERC chairperson and does not include commentary or emphasis that would suggest a clear ideological lean.

RapplerIndependentCenter2 hr. ago

Filipino consumers may see the 12% value-added tax (VAT) on system loss charges removed from their electricity bills as early as November 2026, according to the Energy Regulatory Commission (ERC). The ERC has classified system loss as a government-mandated pass-through cost that should not be included in the VAT base for electricity providers. The Bureau of Internal Revenue (BIR) is preparing a revenue memorandum circular to implement the VAT exemption, expected to be issued in September 2026. While the VAT on system loss charges may be removed by November, eliminating the system loss charge itself will require a phased approach and significant investment, estimated at around P7 billion. The change aims to ensure consumers are not paying VAT on electricity that does not reach their homes or businesses.

Bias read (Center): The article presents information from official sources including the Energy Regulatory Commission (ERC) and the Bureau of Internal Revenue (BIR), providing balanced reporting on the proposed VAT exemption. It explains both the potential removal of VAT on system loss charges and the longer-term goal,