Senate scores PLDT's unduly high profits
The Philippine Long Distance and Telephone Company (PLDT) has been raking in unduly high profits, much higher that what the law entitles it by treating corporate income and franchise taxes as expenses which enable it to declare a much smaller rate of return.
This impression emerged at the January 21 joint hearing of the Senate committee on Trade and Commerce and Public Services chaired by Senators Ramon Magsaysay, Jr. and Tito Sotto respecting on the pending implementation of the proposed telephone metering scheme.
Magsaysay said PLDT officials admitted the irregular practice which had put Meralco in hot waters last year when the Energy Regulatory Board found out the company was overpricing its consumers.
By treating corporate income tax and franchise taxes as expense items, Magsaysay explained, PLDT in effect passes on to consumers the taxes it is supposed to pay to the government.
"In effect, the tax due PLDT is passed on to the subscribers who shoulder the taxes of the phone, company," Magsaysay noted.
The irregular practice, he said, also enables the company to declare a much lower rate of return or profit than what it actually generated.
In today's hearing, Philippine League of Democratic Telecommunication Inc. (PLDTI) president Emmanuel Amador said PLDT has also been giving the National Telecommunications Commission (NTC) inaccurate figures and accounting of its rate of return.
PLDTI is one of the oppositors to the phone-metering scheme PLDT has proposed, which was earlier approved by NTC.
"Now we wonder why the Bureau of Internal Revenue has allowed this practice all this time," Magsaysay said.
Magsaysay warned that PLDT may face similar charges in court as Meralco is now undergoing because of the irregular practice. (PNA) DCT/JCN/jsd
[This news item quoted from the Philippine Cyberview mailing list]
WIRED! Philippines is a monthly online magazine published and hosted by KabayanCentral.com
Copyright 1998 KabayanCentral.com. All rights reserved.