The Federal Board of Revenue (FBR) on Thursday settled the Federal Excise Duty issue with Pakistan International Airlines (PIA) and restored their accounts.
According to sources, the Federal Board of Revenue (FBR) recently took the step of freezing all bank accounts of Pakistan International Airlines (PIA) due to non-payment of taxes.
The national carrier has been grappling with financial difficulties in recent years, primarily attributed to mismanagement of funds, increasing operational costs, and a surge in fuel prices.
In addition to financial challenges, PIA has faced scrutiny regarding its compliance with international safety standards, resulting in temporary bans and restrictions on Pakistani airlines in various countries.
Despite the tax bureau’s action, PIA claims that its flights are continuing without interruption. However, contrary to the airline’s statement, sources have reported that several domestic and international flights have either been canceled or delayed due to the freeze on accounts.
The FBR sources reveal that PIA had failed to deposit Federal Excise Duty amounting to Rs4 billion, which the airline had collected through plane ticket sales. Consequently, the inability to access funds in its bank accounts caused difficulties in paying for fuel, leading the Pakistan State Oil (PSO) to refuse fuel supply to PIA.
As a result, various flights faced disruptions, with some being canceled or delayed due to the fuel supply issues. PIA flights like PK-370 (Karachi to Islamabad), PK-306 (Karachi to Lahore), PK-350 (Karachi to Peshawar), PK-310 (Karachi to Quetta), PK-302 (Karachi to Bahawalpur and Lahore), PK-309 (Islamabad to Karachi), PK-330 (Karachi to Islamabad), PK-739 (Multan to Jeddah), and Karachi to Rahim Yar Khan were among those affected.
In response to the situation, PIA’s spokesperson stated that the airline has reached out to the government in an effort to persuade the tax authorities to unfreeze their accounts. Despite the challenges faced, the spokesperson assured that all aerial operations have been continuing.
However, the situation highlights the severity of PIA’s financial woes and the need for immediate resolution to ensure smooth operations and financial stability for the national carrier.