When charging toll makes no sense

When charging toll makes no sense image

Text: Tito F. Hermoso / Photos: | posted August 09, 2012 14:41

A look into anomalous 'toll' charges

Pay per pass

One of the hallmarks of a thriving 24/7 economy is an open society. Our lives have progressed by leaps and bounds, thanks to our being 'wired'. But our software is only as good as our hardware. For us, that means a network of roads that ease passage of goods and services, transported on a backbone of logistics. Of course, roads costs money and sometimes it is necessary to charge tolls for a given convenience.

Provincial highway robbery?

So why are some Provincial governments charging commercial vehicles an annual toll for passage through their provinces? We refer to these provincial government issued windshield stickers, renewed annually, that allow trucks, Isuzu NKR's, Mitsubishi Canters and the like to pass unmolested by provincial traffic aides through the national government's highways that criss-cross Laguna, Cavite and even the Taytay end of the province of Rizal. Why are the provinces charging this toll on what are essentially 'free' national roads?

Who paid for the road?

Granted that it can be argued that the commercial vehicles can traverse not only national roads but also provincial roads, those provincial roads were built by taxes collected by the national government and/or Congressional pork barrel anyway. It's not as if the Provincial government does its own BOT or PPP funded toll roads without national government funding.

Overloading fee?

Second guessing the provincial government's claim on their right to charge an annual toll leaves us groping for justification. The trucks are usually overloaded? But that's the DPWH's problem and they have weigh bridges to check on loads and fine those that are overloaded. Besides, it's the DPWH that maintains the roads and bridges anyway.

ASBU, highway robbery?

Smoke belching ruining the provincial idyll? What's wrong with the LTO's annual pollution testing requirements for registration? Some LGU's have ASBU or anti-smoke belching highway-side traps that appear to follow some pollution standard that trains its technicians to force 'test' a suspect vehicle to fail. This issue is a loaded dice as our high sulfur 'dirty' diesel, demanded by the public transport lobby for their soon to be extinct dirty diesel engines, is the main culprit for the majority of emissions test failure. Meantime, the supply of parts for antiquated dirty diesel refineries and high-sulfur crude oil is already in decline as the majority of the developing world shifts away from dirty diesel.

Legitimate business expense?

Ok, so the provincial toll fee is only levied on vehicles used for commerce. So, why are they penalized? Our country became a 24/7 economy thanks to the constant free movement of supplies and logistics, the raison d' etre of private trucking. The benefits of easy passage of trucks lowers the cost of living for all Filipinos.

Cost recovery

Toll fees are a daily given. They only enter the limelight stream of consciousness every time the TRB announces a toll fee hike application. In fairness, toll road operators, like any business, must recover any rise in cost lest the increase in cost sinks income below the break even point.

Time is money

But like any bureaucracy heeding transparency's sake, the TRB has to follow procedure; i.e. hearings, committee studies and public consultations which results in lags before the toll hike is approved and private toll road operators can recover their costs. Which is why long franchise periods are desirable for toll road operators as cost recovery will have to take a back seat whenever regulators take time to ponder the merits of a toll fee hike.

Taking their sweet time

Take the toll fee hikes of STAR and SCTEx. Approved for 2012 but to date, the TRB has not allowed its application, which then forces the toll road operator to again apply for an even bigger toll fee increase because of rising unrecovered costs. Unless, of course, the TRB has, by creative stealth, become an unwilling instrument in the government's CCT [Conditional Cash Transfer] program for the 'poor' since a delayed toll fee increase works like an involuntary private toll operator subsidy for road users. Nevertheless, the BOT or PPP principle remains intact. The Private sector builds and operates a road for public use and the government has given it the right to charge for passage.

We paid for it

As for all of us 100m tax payers, whether net contributors or net deducted, we expect the DPWH to build all our roads for our free passage, unless the government has, through the BOT or PPP invited the private sector to invest in a toll road. Since the DPWH builds roads across the entire country, there is no cause for subsidy envy i.e. every tax payer from all over the country can use any road in the country for free. It's not like the subsidized train fare of the MRT where Mindanao and Visayas tax payers subsidize Manila light rail transit commuters.

LGU abuses

Recently, President Aquino, in his EO on Mining Policy, reinforced the supremacy of the National will over Local Government Unit ordinances. To be fair to the LGUs, they never tasted so much legislative power until 1986, when DILG appointed OiC's [officers-in-charge] took over positions of elected mayors and governors. After the enactment of the 1987 Constitution, LGU town councils and Provincial boards exploited their new found law making powers to enact new taxes, their own pseudo Police force, their own versions of congestion bans or coding, pollution standards and yes, toll charges.

Private property

It would be disingenuous to compare provincial toll for commercial vehicle as akin to gated communities or subdivisions charging for through traffic passage. Besides, gated communities are private property that have to address security issues. For any non-resident to be granted passage, bona fide residents have to sponsor the issuance of stickers for outsiders for an annual fee.

Southwoods and the BIR

Interestingly, when Southwoods' village association began charging PHP20.00 for passage through their roads some years ago, the BIR questioned its legality. The village promptly withdrew the toll charge but also banned the passage of non-resident vehicles through Southwoods. Curiously, a village next door has, what looks like, the local Barangay tanod charge toll for passage too and they do issue some piece of paper but whether it is a proper receipt or not, only the BIR can tell. Toll receipts of that Barangay may be small beer, but the provincial governments's stickers are definitely bigger fish for the BIR.

Only TRB's call?

Last time we looked, it is only the TRB who can grant the authority to charge toll on national roads, whether publicly or privately financed. By whose authority are barangays and provincial governments authorized to charge an annual toll?

Hometown mentality ?

We must get the LGUs to stop this hostile hometown mentality from getting out of hand. Today, they charge trucks, but, what's to stop a province or a town from charging a fee for the passage of a road itself? Hypothetically, what's to stop a municipal or provincial government from charging a private builder like CAVITEx an arm and a leg just because it chose to build a costal expressway access road and interchange to some coastal town in Cavite?

Roads for all

Roads benefit all and roads built by our taxes is the government's promised delivery to us in exchange for having paid taxes. Why should any government, municipal, provincial or national charge us again for what we already bought and paid for? The arguments for and against tolls and VAT can recycle here again but that's for another time and place.