The City of San Fernando Water District (CSFWD) has made a significant announcement regarding the removal of the 12% value-added tax (VAT) on water bills, with the change being applied retroactively starting from November 18, 2025. This decision follows an official advisory issued by the district, marking a pivotal shift in billing practices for local residents and businesses.
Retroactive Coverage and Board Resolution
According to CSFWD, the retroactive coverage encompasses billing periods from November 18, 2025, through the February 2026 billing cycle. This adjustment was formalized through Board Resolution No. 15, Series of 2026, which was approved by the CSFWD Board of Directors on February 11, 2026. The resolution explicitly directs the removal of VAT from all water bills issued by the district and mandates that the change be applied retroactively to align with the effective date of the resumption of its business operations on November 18, 2025.
Impact on Customers and Billing Cycles
The retroactive application corresponds to the December 2025 billing cycle, ensuring that customers benefit from the VAT removal across multiple months. CSFWD has clarified that any VAT already collected during the covered period will be reversed. These amounts will be applied as advance payments to customers' water accounts, subject to compliance with existing accounting, auditing, and tax regulations. This move is designed to provide financial relief and correct any overcharges that may have occurred.
Future Billing Adjustments and Compliance
In addition to the retroactive changes, CSFWD will issue a separate advisory detailing new water rates that reflect the VAT removal. These updated rates are set to take effect starting with the March 2026 billing period. The water district emphasized that this initiative aims to ensure accurate billing and full compliance with applicable laws and regulations, thereby enhancing transparency and trust with its customer base.
The announcement underscores CSFWD's commitment to regulatory adherence and customer service, potentially setting a precedent for other water districts in the region. By proactively addressing tax adjustments and providing clear timelines, the district seeks to minimize confusion and support the community's financial well-being during this transition.
