In an action taken on Thursday, the Federal Board of Revenue (FBR) froze13 bank accounts belonging to Pakistan International Airlines (PIA) due toa failure to pay Rs8 billion in Federal Excise Duty (FED). FBR officialshave indicated that even the bank accounts linked to the International AirTransport Association (IATA) will be affected.
The FBR has decided to initiate legal action against PIA officials for notsubmitting the required FED, even though the accounts had been restored inthe past month. PIA’s spokesperson mentioned that this freezing of accountswon’t impact flight operations and assured that government-leveldiscussions are ongoing to resolve the situation. Notably, on July 27, theFBR had initially frozen all PIA bank accounts due to tax non-payment, butthis was later resolved by July 28 after negotiations between the twoparties.
The national carrier has been facing financial challenges due to variousfactors, including mismanagement of funds, increased operational expenses,and rising fuel prices. Additionally, PIA’s adherence to internationalsafety standards has come under scrutiny, resulting in temporary bans onits operations in certain countries. Despite these financial issues, PIAhas asserted that its flights have continued unaffected.
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FBR sources indicate that PIA failed to deposit Rs4 billion FED collectedfrom ticket sales, which has led to challenges in covering fuel costs. Thisisn’t the first time PIA has faced fuel supply issues; Pakistan State Oil(PSO) had declined fuel supply during a previous account freeze.