Pakistan International Airlines (PIA) is facing a significant financial setback as the Federal Board of Revenue (FBR) has frozen 13 of the national carrier’s bank accounts due to the non-payment of Rs8 billion in Federal Excise Duty (FED). The freeze also extends to PIA’s bank accounts associated with the International Air Transport Association (IATA).
FBR officials have expressed their intention to take strong action, revealing plans to register a first information report (FIR) against PIA officials for failing to submit the required FED. Despite the restoration of the frozen accounts in the previous month, the FED remained unpaid, leading to this latest action.
This situation is not new for PIA, as it had encountered a similar issue on July 27 when the FBR froze all of its bank accounts over outstanding tax payments. The accounts were later reinstated on July 28 after discussions between the FBR and PIA resolved the matter.
In recent times, the national carrier has been grappling with financial challenges attributed to mismanagement, rising operational costs, and escalating fuel prices. Additionally, PIA has been under scrutiny for its adherence to international safety standards, resulting in temporary bans and restrictions on Pakistani airlines in various countries.
Despite the frozen accounts, PIA has asserted that its flight operations have continued without interruption. However, FBR sources reveal that PIA has failed to deposit Rs4 billion in FED, which was collected through the sale of plane tickets.
The airline’s predicament has also extended to its ability to pay for fuel. It’s reported that Pakistan State Oil (PSO) declined to supply fuel to PIA during the previous account freeze, exacerbating the challenges faced by the national carrier.
As PIA works to navigate these financial hurdles and address its compliance with safety standards, stakeholders are closely watching the developments that could impact the future of the airline and the aviation industry in Pakistan.
