Last Monday, during the session of the Sangguniang Panlalawigan, somebody finally spoke up about the undeniable consequences of the P5 million being collected by the provincial government of Catanduanes from Virac Water District for unpaid local franchise taxes plus surcharge and interest.
As VIWAD General Manager Gabriel T. Tejerero explained in his advisory to the public last week, it is now preparing the proposed billing adjustments to pass on the Capitol’s taxes to the district’s 12,000 concessionaires.
He said that the water district is compelled to do so to protect its operations and bank deposits from potential freeze orders that could be imposed by the provincial government.
Based on the statement of account sent by the Provincial Treasurer’s Office, VIWAD has a total tax due of P2,645,245.51 based on its annual gross receipts from 2013 to 2024.
Applied each year, the 25% surcharge on the overdue franchise taxes and the interest of 2% per month now amounts to P661,311.38 and P1,706,791.33, respectively.
The accumulated surcharge and interest alone accounts for 47.2% of the total payable amount of P5,013,348.22, or nearly half of the franchise tax due to the provincial government.
And this does not even include the collectible for 2024, which could add another half a million pesos or so to VIWAD’s liabilities.
According to GM Tejerero, the arrears will be divided equitably among the consumers and staggered over an extended, manageable period to minimize its monthly impact on the concessionaires.
This is essentially similar to what the First Catanduanes Electric Cooperative Inc. (FICELCO) has been doing for the power rate increase that it only partially implemented since April 2026 in compliance with the Energy Regulatory Commission’s directive to ECs on the staggered implementation of rate hikes.
Indubitably, VIWAD’s pass-on charge for the Local Franchise Tax will be reflected in the water bill once the board of directors decides to begin paying off its sizeable obligation to the provincial government.
In his privilege speech, PBM Xyrell T. Albaniel described the issue as a matter of grave and urgent concern that directly impacts the pockets, the daily lives, and the fundamental welfare of every single household in Virac and potentially the province.
Stressing that water is not a luxury commodity but a basic human necessity, the first-termer board member reminded everyone that water districts are non-profit, government-controlled entities that do not receive regular funding from the national budget, surviving on their own collections from bills paid by consumers.
“To hit them with retroactive penalties and rigid tax enforcements without a holistic review of the socio-economic impact is, effectively, indirect taxation of our already overburdened citizens,” Albaniel emphasized in filing a resolution calling for a legislative inquiry.
The probe, he said, should lead to a clear analysis of the local franchise tax’s impact and a comparison of the actual fiscal loss to the province against the financial shock to be borne by ordinary consumers.
Hinting at a look back into how the tax on water districts was included in the 2013 ordinance, PBM Albaniel said the SP needs to evaluate whether the measure, as far as the local franchise tax is concerned, still reflects the realities and priorities of public service in the present time.
While there is no information who else aside from the six water districts’ officials, the Local Finance Committee and consumer groups will be invited to the inquiry, it would be prudent for the SP to seek the participation of the Local Water Utilities Administration (LWUA) as well as the president of the Bicol Water Districts Association (BIWADA) to shed light on the issues and answer vital questions.
How many provinces in the Bicol region are actually imposing local franchise tax on water districts in their respective jurisdictions?
Why is there a need for provincial government units to impose the tax on water districts when the latter are already paying a similar franchise tax to the national government?
Why are consumers shouldering the burden of such taxes collected by the government when it cannot even minimize the stealing of public money through ghost and substandard projects enriching public officials and their shady contractors?
The first two questions may be easy to answer but the third will have our honorable Capitol officials either squirming uncomfortably in their seats or lying through their teeth.