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Home3PL/4PLPass-through fees in Manila violate DILG rule, says ARTA

Pass-through fees in Manila violate DILG rule, says ARTA

  • The collection of pass-through fees in Manila contradicts Department of Interior and Local Government Memorandum Circular 2018-133, according to the Anti-Red Tape Authority
  • The circular orders local government units to “refrain from enforcing any existing ordinance authorizing the levy of fees and taxes on their inter-province transport of goods and merchandise, regulatory fees in local ports, and other additional taxes, fees or charges in any form upon the transport of goods and merchandise”
  • The Alliance of Concerned Truck Owners & Organizations (ACTOO) said it hopes the Manila city government will act on the ARTA decision
  • Truckers are required to secure a travel permit, akin to a pass-through fee costing P1,500 from the MTPB. ACTOO said the travel permit costs from P2,200 to P2,500 and official receipts are sometimes not issued

The imposition of travel permits and pass-through fees by the Manila Traffic & Parking Bureau (MTPB) violates a Department of Interior and Local Government (DILG) directive prohibiting such activities, according to the Anti-Red Tape Authority (ARTA).

ARTA deputy director general for operations Atty. Ernesto Perez in a March 18 letter told Manila City mayor Francisco Domagoso that implementing pass-through fees through the issuance of travel permit contradicts provisions of DILG Memorandum Circular (MC) 2018-133, which took effect in August 2018.

MC 2018-133—or the Omnibus Guidelines on the Suspension of Local Government Unit (LGU) Imposition and Collection of Illegal Fees and Taxes Relative to the Transport of Goods and Products—directs LGUs to “refrain from enforcing any existing ordinance authorizing the levy of fees and taxes on their inter-province transport of goods and merchandise, regulatory fees in local ports, and other additional taxes, fees or charges in any form upon the transport of goods and merchandise.”

ARTA added that Section 133 of the Local Government Code (LGC) of 1991 “provides for common limitations on the taxing powers of LGUs, which include, among others, various fees, taxes and other charges on goods carried into or out, or passing through, their respective territorial jurisdictions.”

LGC’s Section 133 is the legal basis for MC 2018-133.

The Alliance of Concerned Truck Owners & Organizations (ACTOO) during a February meeting with ARTA, MTPB, and Metropolitan Manila Development Authority complained about the implementation of travel permit and pass-through fees.

ACTOO vice president Rina Papa during the meeting said truckers were being required to secure a travel permit, akin to a pass-through fee costing P1,500 from the MTPB, in compliance with a Manila city ordinance. According to ACTOO, the travel permit costs from P2,200 to P2,500 and official receipts were sometimes not issued.

Moreover, MTPB was allegedly imposing an estimated P20,000 fee per month, depending on the size of the truck, to be exempted from the One Truck Lane Policy being implemented in Manila City. This, according to ACTOO, “can supposedly be a form of ‘corruption’.”

ARTA said the issue of travel permit and pass-through fees being imposed by the MTPB “may be referred already to the DILG in relation to the alleged violation of the provisions of the subject DILG MC.”

“However, we thought it wise to refer these issues first to your good office for a more appropriate and speedy action and to find an amicable resolution,” ARTA added.

Papa, in a phone interview with PortCalls, said they welcome ARTA’s initiative, which she noted was the result of a series of meetings regarding issues that have been hounding the trucking sector for years.

Papa said, however, she “honestly doesn’t know” what to expect after ARTA’s letter because the Manila City government has been “adamant” on its stand when facing truckers in a dialogue regarding their issues. She noted truckers had been raising the issue for years with various government agencies, including the city government of Manila, to no avail.

Still, she hopes the Manila City government will act on ARTA’s letter.

Stakeholders, especially truckers, have been complaining about the collection of pass-through fees from trucks by every LGU, especially in Metro Manila, that they pass on the way to their delivery destination.

DILG Bureau of Local Government Development director Anna Liza Bonagua in a logistics summit in 2018 had explained that in the 27 years of implementing the Local Government Code, LGUs had been “creative and innovative” in charging fees, and pass-through fees were one such scheme.

Bonagua, however, noted that since 2006, DILG has been reiterating that the collection of pass-through fees is illegal, and has thus issued eight memorandum circulars on the matter, with the latest issuance being MC 2018-133. – Roumina Pablo

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