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CTA denies BIR petition to review RCBC Savings’ tax deficiency

THE COURT of Tax Appeals (CTA) has denied the Bureau of Internal Revenue’s (BIR) petition for review over the tax deficiency case of RCBC Savings Bank, Inc. (RCBC Savings) in 2006 for lack of merit, it said in a decision.

The case stemmed from the P59.8-million tax deficiency inclusive of penalties for 2006, as assessed, which RCBC Savings protested before the BIR in February 2012.

In its initial investigation, the BIR said the tax deficiency of the bank amounted to P1.7 billion, reduced to P64.3 million in the preliminary assessment. This was changed to P59.8 million in the Final Assessment Notice (FAN).

RCBC Savings also filed an appeal in December 2013, which the BIR denied in January 2015.

Following this, the bank brought the case to the CTA for review which was granted in December 2018, cancelling the payment for the assessed P59.8-million tax deficiency.

The BIR in January 2019 asked for a reconsideration, but the court denied the motion.

The CTA explained in the 14-page ruling dated Oct. 13 that the petition for review of the BIR only reiterated its arguments in the motion for reconsideration.

“The Petition is a mere rehash of the Motion for Reconsideration filed by petitioner before the Court in Division,” the ruling said. “The arguments therein have already been extensively passed upon by the Court in Division when it resolved the said Motion for Reconsideration.”

RCBC Savings Bank was the thrift unit of Rizal Commercial Banking Corp. and was merged into the latter in 2019. — CAT

Ready-for-occupancy units available at Bria Homes

BRIA HOMES is offering house and lot packages that are ready for occupancy (RFO) in Magalang, Pampanga.

The community is located in close proximity to both Mabalacat, Pampanga, and Concepcion, Tarlac, and 35 minutes away from Clark Freeport and Special Economic Zone.

Amenities include the multi-purpose hall, covered basketball court, and the landscaped garden. The community has a guarded entrance, 24/7 CCTV coverage and a perimeter fence.

“We understand that the need for housing remains an urgent concern for many Filipinos nationwide. With scores of RFO homes available at our developments, we hope to see more Filipino families moving into affordable and comfortable dwellings in as fast a time as possible,” Rizalito “Red” J. Rosales, president and CEO of Bria Homes, said in a statement.

Bria Homes is a subsidiary of listed Golden Bria Holdings, Inc.

Earnings reports, economic data to boost PSEi

By Denise A. Valdez, Senior Reporter

PHILIPPINE SHARES may rise this week on the back of companies’ reports on their third quarter corporate earnings and the release of manufacturing and inflation data.

The bellwether Philippine Stock Exchange index (PSEi) added 74.61 points or 1.19% to close at 6,324 on Friday, declining by 160.06 points or 2.5% on a weekly basis.

Value turnover jumped 41% to an average of P11.97 billion, as net foreign buying grew more than 10 times to an average of P392.86 million.

For this week, the primary local catalysts would be corporate earnings and macroeconomic data, Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said.

“Investors are expected to take cues from the upcoming preliminary third quarter/nine months corporate reports,” he said in a text message. “Signs of improvements in corporate earnings (if 3Q earnings contraction eases compared to 2Q) could give the local market a boost.”

Also scheduled this week are the release of October inflation data and September trade report by the Philippine Statistics Authority, and October factory activity in the Philippines by IHS Markit.

Aside from local news, investors will also monitor overseas events slated for the week, particularly the US elections on Nov. 3.

“After the Halloween long weekend, markets will be met by headlines coming from the US elections,” online brokerage 2TradeAsia.com said in a market note.

“Note that unlike its iterations in previous years, the 2020 elections outcome may not be announced on the same day (made complicated by early voting and mail-in ballots); this exacerbates speculation, and with it, higher volatility,” it added.

Any shift in political power commonly causes jitters among investors, 2TradeAsia.com said. But particular to this year’s elections would be the effect of the results on US-China trade relations, Iran oil sanctions and the coronavirus stimulus bill.

“As many other concerns are tied to this year’s US showdown, funds may remain guarded, until the terrain becomes less uncertain—worst-case, wait until the actual swearing off into office of a new US president (if Joe Biden wins) or reelection (if Donald Trump wins) by January 2021,” it said.

“Lingering worries offshore amid the surge in COVID-19 cases and the reimplementation of social restrictive measures primarily in Europe could serve as a downside risk to the market,” Philstocks Financial’s Mr. Tantiangco added.

But for 2TradeAsia.com, the pullbacks after the PSEi’s recent rally to the 6,000 level are “common, often even desired, as these signal more sustainable ascents.”

The brokerage is putting immediate support for the PSEi within 6,150-6,200 and resistance within 6,500-6,700. Mr. Tantiangco of Philstocks expects support within 6,000-6,100 and resistance at 6,600.

Further monetary stimulus may boost peso, push up bond yields

THE CENTRAL BANK may adjust monetary policy further to support the government’s limited fiscal space and strong balance of payments (BoP) position, Nomura said in a report, but this would result in loose liquidity, a stronger peso and slightly higher government bond yields.

In its latest scorecard of 20 emerging markets, Nomura lumped the Philippines with Brazil, India, China, Poland and Thailand as economies having a strong BoP but weak fiscal position. 

“Here there are fairly strong incentives for central banks to intervene in both the FX market and government bond market. We would expect liquidity to be loose, local currencies to be stable to stronger against USD, and government bond yields to be stable to higher,” Nomura said in its Emerging Markets Special Report dated Oct. 28.

It said central banks can also limit currency appreciation and preserve the competitiveness of exports to help with the limited fiscal space.

“The weak fiscal position justifies central banks continuing their government bond purchase programs to avoid a spike in bond yields, especially for countries with very weak GDP (gross domestic product) growth and if public debt and bond yields are relatively high,” it added.

The Bangko Sentral ng Pilipinas (BSP) has released some P1.9 trillion in liquidity into the financial system so far this year through monetary actions rolled out to help cushion the economy from the effects of the coronavirus pandemic.

To aid the government and its limited fiscal space, the BSP approved a P540-billion provisional cash advance last month. This came after the government settled its outstanding loans worth P300 billion.

The BSP can provide the government provisional advances of up to P850 billion only.

However, Nomura warned of the potential risks that may arise from these interventions.

For instance, it said central banks have the option to lower the amount of government bonds they buy, which could be due to the fear of losing monetary policy autonomy or if the potential increase in bond yields is constrained as this attracts more capital flows to the local bond market.

It said it could help manage a possible sharp appreciation of currency through reduced bond purchases and more foreign exchange intervention.

“A perhaps small but possible tail risk of the central bank  stepping back from its government bond purchases amid a weak fiscal position is that it may raise investor concerns over public debt sustainability, stoking capital flight instead of capital inflows,” it said.

Nomura expects the six countries with weak fiscal positions to maintain loose liquidity and a stable to stronger currency against the greenback, with government bond yields seen to be stable or inch up.

The country’s BoP surplus widened to $2.104 billion in September from $38 million in the same month last year. Year to date, the BoP surfeit climbed 24% year on year to $6.88 billion.

The BSP expects the overall BoP position to yield a surplus of $8.1 billion by yearend.

Meanwhile, the government’s budget deficit narrowed by 22% to P138.5 billion in September, bringing the nine-month gap to P879.2 billion, up 194% from the year prior. — B.M. Laforga

BSP exploring supply chain financing for MSMEs

THE Bangko Sentral ng Pilipinas (BSP) is evaluating a plan to provide financing to micro-, small-, and medium-sized enterprises (MSMEs) that belong to the supply chains of larger firms, easing their collateral requirements by leveraging the superior credit profiles of their major customers.

The supply chain financing (SCF) scheme will include overhauling regulations and establishing an electronic platform that can be tapped by multiple lenders.

“Along with an enabling regulatory environment around electronic invoicing, electronic signatures, and secured transactions, the strategic intervention may include the development and operation of a multi-lender electronic SCF platform which may be run by the BSP or other government agencies as has been successfully done in Mexico, China and Chile,” the central bank said in an e-mail to BusinessWorld.

Through SCF, suppliers may be able to access credit more easily as verified suppliers of large firms.

According to a study performed by the Asia-Pacific Economic Cooperation, small businesses in the Philippines, Vietnam, Chile, Mexico, and Peru need to present collateral worth about 212% to 346% of their proposed loan.

In the Philippines, MSMEs accounted for about 99% of the roughly one million registered businesses in 2018, according to the Department of Trade and Industry.

Credit extended to micro and small enterprises (MSEs) totaled P208.201 billion in the first quarter, or about 2.47% of the banking system’s loans overall. This is lower than the 10% required under Republic Act. No. 6977 or the Magna Carta for MSMEs.

“SCF not only supports the smaller firms but also their large corporate buyers in terms of improved working capital management and reduced supply chain disruptions, as well as the bank itself in terms of better credit risk management and additional revenue streams,” the BSP said.

It added that Republic Act No. 11057 or the Personal Property Security Act passed in 2018 which requires the establishment of a unified legal framework for securing obligations with personal property, will also support the development of the SCF market.

“The BSP therefore finds SCF as a compelling proposition for MSME financing, especially considering the economic onslaught of the pandemic that has significantly affected MSMEs,” it said.

The central bank cited a study by the International Finance Corp. (IFC) which found most banks in the Philippines have yet to gauge and review the SCF legal requirements.

The study identified as possible constraints technology due to “legacy systems and paper-based supply chain transactions; on-boarding and documentation challenges; and limitations of the credit infrastructure that supports industry-wide visibility of loan exposures to SMEs.”

“There are industry players that have invested in supply chain financing capabilities. Nonetheless, the SCF market at this point still has much room to grow” the BSP said.

The central bank is exploring collaborations with experts in the SCF market, including the IFC, which helped China’s central bank, the People’s Bank of China, set up its SCF platform, which has over 200,000 businesses registered and facilitated access to about $1.7 billion in credit over the past seven years. — Luz Wendy T. Noble

Finance dep’t touts CREATE bill’s role in attracting investment for renewable energy

FINANCE SECRETARY Carlos G. Dominguez III said incentives offered in pending tax reform legislation could facilitate the attraction of investment in clean energy projects, which will go hand-in-hand with the government’s recent ban on new coal-fired power plants.

Mr. Dominguez expressed his support last week for the Energy department’s plan to reduce the Philippines’ reliance on coal as a source of energy and adopt more renewable sources.

“This, in conjunction with CREATE’s performance-based fiscal incentives, will steer private capital towards new investments in renewable energy,” Mr. Dominguez told reporters on Monday via Viber.

He was referring to the Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill, which aims to lower the corporate income tax rate to 25% this year from 30% currently, while reforming the incentives regime by making them more performance-based and time-bound.

The bill forms part of the government’s economic recovery program but is currently pending at the Senate.

Mr. Dominguez said the measure has several provisions that give “generous and performance-based” tax incentives to investments under the Strategic Investment Priorities Plan, which will soon include the renewable energy sector. The sector’s existing incentives will be retained even after the measure is approved.

He said companies involved in renewable energy would also benefit from the measure as it offers income tax deductions for research and development.

“The enhanced deduction is designed to boost innovation, such as efficient power generation and improved battery technology,” he said.

Deductions for training could also be employed to create green, high-skilled jobs, he said.

Finance Assistant Secretary Maria Teresa S. Habitan said in a Viber message that the bill offers double deductions against gross income for investment in research and development as well as in training.

The Philippines is among the most disaster-prone countries in the world, according to the 2020 World Risk Index.

Last week, the Energy department imposed a moratorium on new coal-fired power projects and allowed foreign investors to take 100% ownership in geothermal projects.

Energy Secretary Alfonso G. Cusi said the shift will facilitate more investment in sustainable power production and make the power mix flexible.

The department is currently reviewing the Philippine Energy Plan for the next two decades. — Beatrice M. Laforga

PHL, Indonesia seen as ASEAN’s COVID recovery laggards

THE ASEAN region is seeing some pockets of recovery but the overall picture is mixed with the Philippines and Indonesia the clear laggards in the region, according to Maybank Kim Eng.

The development of a vaccine will help close the gap with other countries that have more successfully contained the virus, it added.

“It was more of a struggle to uncover the ‘V’s in the Philippines and Indonesia, the two ASEAN countries which have yet to flatten the pandemic curve,” Maybank Kim Eng said in a report, referring to the phenomenon of V-shaped recoveries.

In the region, Singapore and Vietnam experienced V-shaped recoveries, it said, with Vietnam the region’s outlier in avoiding a recession this year, and its exports already above pre-pandemic levels.

The Philippine economy contracted by a record 16.5% in the second quarter, which included the weeks when the lockdown was strictest. The government is projecting a less drastic contraction in the third quarter and projects gross domestic product to contract between 4.5% and 6.6% in 2020.

“A vaccine will help improve domestic mobility and ease strict lockdowns and social distancing rules, a shift that will make a significant difference to the larger pandemic-hit domestic economies, particularly the Philippines and Indonesia,” Maybank Kim Eng said.

Maybank Kim Eng said power demand in the Philippines was among the “surprising sharp V rebounds” even with many offices still shut. In September, power demand grew 2.1% year on year coming from the 3.3% contraction seen in August.

The country was also experiencing a “weak V” recovery in remittance inflows as economies hosting overseas workers reopened, Maybank Kim Eng said.

Cash remittances from overseas Filipino workers (OFWs) rebounded to positive year-on-year growth in June and July after sharp declines between March and May. They declined 4.1% to $2.483 billion in August due to weak inflows from the Middle East and Japan.

“Our Chief Economist… thinks that the outlook for overseas workers remittances will likely stay challenging in the near term, especially with the recent new waves of infections that are triggering countries to re-impose restrictions and partial lockdowns,” Maybank Kim Eng said.

Cash remittances to the Philippines declined 2.6% to $19.285 billion in the first eight months. The central bank expects inflows to drop by 2% this year.

The US, which is the largest remittance source for the Philippines, is the world leader in COVID cases, while Europe is currently experiencing a second wave.

More than 231,000 OFWs have been repatriated as of Oct. 25, according to the Department of Foreign Affairs. The government expects about 300,000 OFWs to be brought home by the end of 2020. — Luz Wendy T. Noble

Climate projects offered as path to unlocking investment

CLIMATE CHANGE mitigation projects will help attract foreign investment, starting with government-backed attempts to upgrade facilities to international standards, experts said.

The main driver is the Philippines’ need to invest more in climate change and green growth strategies, International Monetary Fund Representative to the Philippines Yongzheng Yang said in a online business conference Friday.

“We all know the country is very vulnerable to climate change, natural disasters so investing more in this area is a good policy, is a good way forward,” he said.

Officials have proposed a climate emergency to expedite such measures, as did Environment Secretary Roy A. Cimatu last month, due to the loss of billions every year to typhoons and other disasters.

Environmental NGOs have been asking the government to make this declaration to prioritize climate measures in policymaking and to hold fossil fuel companies accountable.

Compliance with international environmental standards is a key draw for international investors and will help unlock financing, Organisation for Economic Co-operation and Development Policy Advisor Stephanie Venuti said at the same conference.

“These standards are backed by governments internationally so they’re understood by a number of trading partners. They’re understood by a number of international businesses. So in demonstrating implementation of these standards, that is an opportunity to attract investment and open up international market opportunities,” she said.

“They are embodied or embedded into international trade agreements.”

Governments can develop policy and businesses can start preparing, she said, ahead of international trends that could require responsible business conduct.

The European Commissioner for Justice, Didier Reynders, announced in April that the commission is developing rules for mandatory environmental and human rights due diligence for companies. The commission’s studies found gaps in the implementation of environmental and human rights standards despite the current practice of voluntary compliance.

“(Environmental compliance is) also a way to demonstrate resilience of your business operations and your supply chains, which as we know that’s the key,” Ms. Venuti said. — Jenina P. Ibañez

EU, PHL trade meetings to resume soon

ECONOMIC COOPERATION and trade meetings between the Philippines and the European Union (EU) are set to continue before year’s end, the EU delegation said.

“We are happy to announce that these subcommittees will take place before the end of the year, obviously in virtual, remote (setting),” First Counsellor of the EU Delegation to the Philippines Rafael de Bustamante said.

Under the EU-Philippines Partnership Cooperation Agreement, the two sides created three subcommittees: development cooperation, trade, investment and economic cooperation, and good governance, rule of law and human rights.

The two sides at the first meeting reviewed their cooperation arrangements, and explored opportunities in security, the economy, human rights, sustainable development goals, environment, natural resources, and climate change, the European Commission said.

Noting trade growth in recent years, Mr. Bustamante said bilateral trade is “far from its full potential.”

“It does not help too that the trade between the EU and the Philippines in the first nine months of 2020 has declined by more than 20%” he said. “There is indeed ample margin to do more and also to recover the ground lost during the pandemic.”

He added that in terms of investment, the EU continues to view the Philippines as a large and fast-growing market.

“However, the Philippines (has not succeeded) in mobilizing European traders and investors in line with the size and potentiality of the Philippine market.”

The Philippines only attracts around 4% of total EU foreign direct investment in ASEAN each year, he said, but added that the Philippines take advantage of some programs.

The Philippines, he noted, did not impose trade barriers during the crisis, creating a “favorable business climate” that can help attract investors.

The Philippines also has trade perks that give many of its products duty-free access to the EU market, he added. The European Parliament had recently voted to ask the European Commission to revoke the country’s Generalized Scheme of Preferences Plus (GSP+) due to human rights concerns.

“We look forward to continue a fruitful collaboration with the Philippines for the correct implementation of GSP+ in the years to come, especially in respect of human rights conventions subscribed to by the Philippines,” Mr. Bustamante said.

The European Commission is expected to increase its focus on Southeast Asia after Germany took over the commission’s top post, German Ambassador to the Philippines Anke Reiffenstuel said in February. She said that the commission is interested in the Philippines’ infrastructure program, as well as connectivity between Europe and Southeast Asia. — Jenina P. Ibañez

Building approvals flat in 2019

CONSTRUCTION starts as measured by building permit approvals declined slightly in 2019, the Philippine Statistics Authority reported in its final estimates for the indicator.

Building approvals declined 0.02% in 2019 to 173,162. The retreat in the number of approvals reverses the 13.9% rise posted in 2018.

Approved projects involved 41.6 million square meters (sq.m.) of floor space, up 1.2%, valued at P491.8 billion, up 3.3%.

Permits for residential projects, which made up 71.8% of the total approved building permits last year, declined by 1.7% to 124,275. These projects were valued at P225.8 billion with a floor area of 20.01 million sq.m.

Single-detached homes accounted for 105,595 permits, followed by apartments at 14,501, duplexes and quadruplexes 3,784, condominiums 177, and other residential projects 218.

Non-residential project approvals rose 9.3% to 26,649, worth P233.2 billion and involving a floor area of 20.9 million sq.m.

Within the category were permits for 16,251 commercial buildings, 5,887 institutional buildings, 2,649 industrial buildings, 1,179 agricultural buildings, and 683 “other non-residential” buildings.

Permits for additions to existing structures numbered 6,166 in 2019, while those for alterations and repairs of existing structures numbered 16,072.

Region IV-A (CALABARZON) topped the regions with 42,762 in approved construction permits. Region VII (Central Visayas) and Region III (Central Luzon) followed with 19,828 and 18,965 permits, respectively.

By value, Metro Manila had projects amounting to P158.1 billion, followed by CALABARZON with P77.4 billion and Central Visayas P52.3 billion. Together, these three regions accounted for 58.5% of construction value last year.

“It seems counterintuitive given that in 2019, ‘Build, Build, Build’ was ongoing, reinforcing private construction,” Asian Institute of Management Economist John Paolo R. Rivera said in an e-mail, referring to the government’s infrastructure program.

“This decline (may be attributed) to… delays in executing contracts, supply chain constraints in sourcing construction materials both locally and internationally, logistical challenges, business disruptions, and a sign of deteriorating business and consumer sentiment not just in the country, but also in our neighboring countries and across the world,” he added.

The construction sector’s gross value added grew by 7.8% in 2019, exceeding the Philippines’ gross domestic product growth of six percent that year. The sector’s growth last year, however, was lower than the 14.3% posted in 2018.

Mr. Rivera expects “slow to moderate” recovery in construction statistics this year, but that this would depend on how soon the pandemic is contained.

“I do not see a quick recovery for construction because given the financial constraints, funds may be reallocated from construction/infrastructure spending to more immediate or pertinent concerns such as consumption, bail-out subsidies, or recovery expenditures,” Mr. Rivera said.

“However, the construction sector will certainly bounce back in 2021, if the Philippines can contain the pandemic and fully bootstrap the economy’s other sectors.” — Michelle Anne P. Soliman

Relief for resilient taxpayers

Someone once said, “Today is hard, tomorrow will be worse, but the day after tomorrow will be sunshine.”

Never give up. Ever since COVID-19 broke out, no day has been easy. The lockdown and quarantine caused job losses and disrupted what we consider normal.

The pandemic has dominated headlines for the past 10 months.  Unfortunately, there are other challenges apart from this crisis. As I write this, super typhoon Goni (Philippine name: Rolly) is hammering southeastern Luzon with strong winds, high waves and floods. This is another blow to the already troubled economy.

With all these challenges, businesses are certainly adversely affected, and taxpayers are definitely asking about tax relief and measures to help them on the road to recovery. Currently, taxpayers can get some form of relief from the following: (1) Republic Act No. 11494 or the Bayanihan to Recover as One Act (Bayanihan II), (2) Voluntary Assessment and Payment Program (VAPP), and (3) Tax Amnesty Program on delinquencies.

BAYANIHAN II
There has been a lot of discussion on relief measures, including the extension of the net operating loss carryover over the next five years, tax exemptions for certain donations, tax exemptions for retirement benefits, COVID-19 special risk allowances, compensation and hazard pay, among others.

In relation to Bayanihan II tax relief, the Bureau of Internal Revenue has issued revenue regulations (RR) 24-2020, 25-2020, 26-2020, 27-2020, 28-2020, and 29-2020.  These BIR issuances provide the conditions and requirements needed in order for the taxpayers to avail of the exemptions from taxes, thereby aiding their recovery if only in part.

VAPP
Under this program, the impression is this was launched to maximize and promote the government’s revenue collections. Taxpayers are encouraged to make voluntary payment of additional tax due covering the taxable year ended Dec. 31, 2018 and fiscal year 2018 ending on the last day of the months of July 2018 to June 2019, including certain covered one-time transactions. The BIR issued Revenue Memorandum Circular 111-2020 to clarify certain issues relating to the VAPP application.

However, viewed in another way, taxpayers may want to have another look at the program to see whether the program actually benefits them. The main benefit of the program is the privilege of taxpayers availing of VAPP to be exempted from audit for the covered taxable period and for the tax types covered by the availment.  Consequently, the program would save taxpayers the bother of a full-blown tax assessment, which has the potential to reach the courts.

Comparing the benefits of the program with the costs of availing, some companies may find some form of relief to their advantage.  At least, if the tax assessment process is taken out, even for just one taxable year, a company focuses more on its business operations and recovery strategies.

It should also be noted that the deadline for availing of the VAPP is on Dec. 31, 2020 unless extended by the Secretary of Finance.

TAX AMNESTY PROGRAM ON DELINQUENCIES
This amnesty program was issued by the BIR last year, and its availment was extended until Dec. 31, 2020. It provides for the processing of the tax amnesty application on delinquent accounts as defined in Republic Act 11213, covering the taxable years ended 2017 and earlier.

As in the case of VAAP, the taxpayer may consider weighing the costs and benefits of availing of the tax amnesty program. The idea is for the taxpayers to get some things out of the way, in order to have more time to spend on the core business.

These programs remind taxpayers that there is always some form of relief available during these challenging times.

As COVID-19 cases continue to rise, aggravated by a recent calamity, it is good to know that the government is responding and that each of us is showing resilience. It is never easy, but we get stronger despite the crisis.

The taxpayer wish list, perhaps, includes asking the government to broaden the tax relief to ease their burden and to help them effect a speedy recovery. Congress is currently considering a general tax amnesty law to support the government’s finances.  Hopefully, this proposal and other tax measures happen very soon, as we need swift action in these difficult times. The government and each of us need to work together to recover. Resilience is an important part of growth and change.  This is our new reality and we can fight.

Let’s Talk Tax is a weekly newspaper column of P&A Grant Thornton that aims to keep the public informed of various developments in taxation. This article is not intended to be a substitute for competent professional advice.

 

Maricel P. Katigbak is a senior manager of the Tax Advisory & Compliance division of P&A Grant Thornton, the Philippine member firm of Grant Thornton International Ltd.

pagrantthornton@ph.gt.com

At least 16 people die as Goni pummels eastern Philippines

AT LEAST 16 people died and three more went missing after the world’s strongest typhoon this year battered the Bicol region in eastern Philippines and several other provinces on Luzon island, according to the Office of Civil Defense.

About 373,000 families or 1.5 million people were affected in five regions, while half-a-million people in eight regions were forced to flee to avoid the path of Goni, a super typhoon that weakened after making two landfalls in Bicol on Sunday morning, the local disaster agency said in a report on Monday.

Storm signals were lifted on Monday morning as Goni, locally named Rolly, continued to move away from the Philippines. The state weather bureau said the typhoon was expected to leave the country on Tuesday morning.

About 20 typhoons hit the Philippines from the Pacific Ocean each year. In November 2013, Typhoon Haiyan (Yolanda) struck central Philippines, killing more than 7,000 and forcing more than 5 million people to flee after wiping out entire villages.

Goni packed maximum sustained winds of 215 kilometers per hour (kph) near the center and gusts reaching 295 kph, the weather bureau said on Sunday.

It first made landfall in Bato, Catanduanes early Sunday morning before heading toward Tiwi, Albay. It made a third landfall in San Narciso, Quezon province at noon.

The typhoon damaged 19 road sections and four bridges in five regions after it caused heavy flooding and landslides uprooted trees and power utility posts. Fifteen of the roads and all bridges were still not passable, the Civil Defense office said.

It said 147 cities and municipalities in Bicol, Calabarzon, Mimaropa and Eastern Visayas had experienced power interruptions and failures.

Bacman geothermal power plant units 1 and 3 were put on emergency shutdown earlier as a preemptive measure, while unit 2 was put on house load, the disaster agency said.

Ilijan plant was shut down on Nov. 1 as a contingency measure  to avoid damage, while SLPGC 1 was put on emergency shutdown on Oct. 31 due to boiler tube lead, it added.

Before Goni hit land, the Public Works department placed 777 heavy equipment vehicles, 518 tools and 4,931 workers in areas that were likely to be hit. Public Works Secretary Mark A. Villar told an online news briefing on Monday.

The roads that were not passable in the Cordillera Administrative Region included the Claveria-Calanasan-Kabugao road and Apayao-Ilocos Norte road, after the soil collapsed.

In Central Luzon, the Sto. Tomas-Minalin-Macabebe Road and Nueva Ecija-Aurora road remained closed to traffic because of flooding and mudslides. The Catanauan-Buenavista road in Calabarzon remained closed after several trees fell.

Road sections in the Bicol region that were closed to traffic were the Legazpi-Sto. Domingo-Tabaco-Tiwi-Camariñes Sur boundary road; Tabaco Wharf road 1 and 2; Daang Maharlika in Polangui, Albay; Daang Maharlika in Sipocot, Camariñes Sur; and Naga City-Carolina-Panicuasson road.

Also closed were the Manguiring-Sibobo-Cagsao Cabanbanan road; Milaor-Minalabac-Pili road; Lagonoy-Caramoan road; Goa-Tinambak road; San Rafael-Mampirao road; Daang Maharlika Nabua-Poblacion section; Baao-Iriga City-Nabua road; and Iriga City proper and Donsol-Banuang Gurang road. — Norman P. Aquino and Kyle Aristophere T. Atienza

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