The Federal Board of Revenue (FBR) froze Pakistani International Airlines PIA’s bank accounts amid security concerns by the European Union (EU).
FBR took this decision after the national flag carrier PIA failed to pay 55 billion rupees of federal excise duty. This action has worsened the problems of PIA which has been plagued by severe financial crisis for several years.
This decision comes when a team from the European Union’s Aviation Safety Aviation (EASA) is in Pakistan to review the safety measures of PIA. EASA banned PIA from flying flights to Europe in 2020 following a plane crash on May 22, 2020, in Karachi.
A PIA spokesperson said it was unfortunate that the FBR opted to block its accounts at a time. When an EASA group was in the country to investigate flight safety issues.
According to FBR officials, the payments of PIA in federal excise duty exceed 55 billion rupees until September 2023. PIA has failed to pay this amount despite repeated notices. Furthermore, tax payments of PIA for October 2023 are unknown. Because its tax returns for that particular month have yet to be filed.
To recover these tax payments, the subsidiary unit of FBR, the Large Taxpayers Unit (LTU) in Karachi froze all of PIA’s bank accounts. Banks have been instructed to transfer any money received in PIA accounts to the treasury accounts of FBR as soon as possible.
Due to unpaid dues, Pakistan State Oil had to cancel and delay a number of PIA flights last month. According to a Bloomberg report, the liabilities of PIA are about 743 billion which is approximately $2.5 billion rupees. These dues are more than five times its entire assets.
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