The city council has requested that the Memorandum of Agreement (MOA) between the Bases Conversion Development Authority (BCDA) subsidiary John Hay Management Corporation (JHMC) and the city government be prepared quickly.

The council said this was necessary for the local government to start an inventory of businesses within the Special Economic Zone (SEZ) that do not qualify for tax exemption under the Philippine Export Zone Authority (PEZA) law.

“The council is directing the city legal officer to expedite the process following the Supreme Court’s 2023 ruling that only businesses registered with the PEZA are exempt from obtaining a permit from the local government where they operate,” said Jordan Habbiling, the city council’s information officer, on Monday,

Last year, the Supreme Court said business permits are required as they do not fall under “taxes” as envisioned in the PEZA law.

Last week, Habbiling said BCDA committed to submitting the MOA, which will guide the city’s inspectorate team in doing the inventory of businesses operating inside Camp John Hay.

“The inventory will help the city government accurately calculate the receivables from BCDA-JHMC,” he said.

Mayor Benjamin Magalong has tasked the City Legal Office to notify JHMC that the city’s inspectorate team would soon conduct the inventory, Habbiling said, after the local government’s recent attempt to do so were rebuffed.

The Supreme Court in 2023 denied for lack of merit the petition of state-owned BCDA and JHMC, which assailed the decision and order of the Regional Trial Court (RTC) that upheld City Hall’s administrative order requiring establishments within the John Hay Special Economic Zone (JHSEZ) to secure business permits and pay the corresponding fees.

In a 45-page decision, the SC affirmed the decision of the RTC upholding the power of the local government to issue business permits to the businesses operating in the 248-hectare JHSEZ with the 625-hectare Camp John Hay and for the same to pay their corresponding taxes.

Meanwhile, in addition to the regulatory fees, the City Council urged the executive department to collect the unpaid dues from the BCDA and JHMC aggressively.

According to recent computation, the BCDA had unpaid financial obligations to the city government totaling PHP225 million as of 2021. (PNA)