DILG warns LGUs: Stop imposing pass-through fees on goods, services

September 19, 2018

THE Department of the Interior and Local Government (DILG) again warned all local government units (LGUs) to stop collecting pass-through fees on goods and services or face sanctions.

“The DILG has been persistent in reminding LGUs to refrain from imposing pass-through charges on goods and services. For the nth time, desist collection for there are prevailing sanctions for those proven guilty of violation,” Interior and Local Government OIC-Secretary Eduardo M. Año stressed. 

Año said local officials who fail to take action on the collection of pass-through fees may face administrative disciplinary actions or be charged with abuse of authority under Section 190 and Section 60 of the Local Government Code.

Section 90 specifically states that the enforcement of any tax ordinance or revenue measure after due notice of the disapproval or suspension shall be sufficient ground for administrative disciplinary action against concerned local officials and employees.  On the other hand, Section 60 stipulates the “Grounds for Disciplinary Actions” specifically Section 60 (e) Abuse of Authority.

The DILG issued the warning after receiving complaints on  the continuous imposition of taxes, fees and charges on transported goods and passengers passing through local government units' (LGUs) jurisdiction despite various policies issued by the Department.

The Local Government Code provides that the exercise of the taxing powers of LGUs shall not extend to the levy of taxes, fees, and charges and other impositions upon goods carried into or out of, or passing through, the territorial jurisdictions of LGUs in the guise of charges for wharfage, tolls for bridges or otherwise, or other taxes, fees, or charges in any form whatsoever upon such goods or merchandise, among others.

According to Año, reports said some LGUs are collecting taxes, fees and other charges on transportation of goods and products carried into or out of, or passing through their territorial jurisdiction in the guise of sticker fee, discharging fee, delivery fee, market fee, and/or mayor's permit, among others.

“We have not been complacent on this predicament. The DILG has made it clear what its stand is. Kulang talaga ng pagsunod sa mga pamahalaang lokal,” he added.

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