New bill filed to stop toll operators from collecting 12% VAT

Another ally of motorists at the House of Representatives
Sep 12, 2011

Motorists using toll roads are dreading the arrival of October 1, the day expressway operators are scheduled to start collecting the 12-percent expanded value-added tax. But another lawmaker has filed a bill that will hopefully prevent government from adding a new financial burden to the public.

Rep. Homer Mercado (Party-list, 1-UTAK) authored House Bill 5171 to seek the exclusion of toll operations from the meaning of "sales of services," which is subject to VAT according to the National Internal Revenue Code (NIRC).

"In these times of economic hardship, not to mention the advent of typhoons affecting the National Capital Region and nearby provinces, there should be an amendment to the NIRC and the EVAT law to ensure that no further unnecessary burden be permitted by the government that will aggravate the poor conditions of the majority of the people," Mercado said in a statement.

Mercado said adding a 12-percent VAT to toll would only raise the cost of agricultural produce, bus fares and basic goods transported through major expressways.

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"There is now a mounting opposition to the implementation of VAT on toll and thus the need to defer its implementation despite the recent Supreme Court ruling dismissing for lack of merit a petition for declaratory relief from the VAT imposition on tollway collection of operators," Mercado added.

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Mercado is not the only one who has filed a bill that aims to stop government from collecting the 12-percent EVAT for the use of toll roads.

In August, Rep. Arthur Yap (3rd District, Bohol) authored House Bill 4971, which seeks exemption of the use of tollways from VAT collection.

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