PIA pays its due tax after FBR freezes accounts

Published: May 3, 2018
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Pakistan International Airlines. PHOTO: AFP

Pakistan International Airlines. PHOTO: AFP

KARACHI: The Federal Board of Revenue (FBR) – an institution responsible for collecting taxed revenues in the country – briefly froze the state-owned Pakistan International Airlines’ (PIA) bank accounts after it failed to submit national exchequer’s dues on time.

FBR had frozen PIA accounts after it delayed submitting “current month tax collections of around Rs1 billion,” a FBR official told The Express Tribune.

Despite 18% growth, FBR falls Rs99 billion short of revenue target

Besides, PIA has a chronic issue of delaying submitting FBR dues. “Its long pending old dues stand at around Rs32 billion. We don’t freeze PIA accounts on dues in pending since ECC (Economic Coordination Committee of the Cabinet) stayed the matter,” the official said.

PIA is given 45 days to compile the tax collections every month. Accordingly, it is supposed to pay current monthly dues on 15the day of every month in the cycle.

The national carrier collects a big chunk of monthly taxes from Federal Excise Duty (FED) on tickets’ sales. Besides, it also collects Withholding Tax (WHT) on tickets and Income Tax it deducts on monthly salaries to its employees.

PIA spokesman Mashood Tajwer said “FBR has unfrozen PIA accounts yesterday (Wednesday) after we submitted partial dues and negotiated (assured) to pay remaining later on.”

The accounts were frozen on last Friday (April 28) due to delay in submission of the dues. Technically speaking, the accounts remained frozen for one day only, excluding weekly off days and other governmental holidays on account of Labour Day.

After all “we are the two governmental institutions…are having some sort of understanding as how to operate (in the provided circumstance),” he said.

Reforming tax structure should be priority

The airlines sold tickets worth over Rs24 billion in the quarter ended March 31, 2017. Its accumulated losses increased Rs11.52 billion to Rs319.10 billion in the quarter. It is yet to announce financial results for remaining quarters till March 31, 2018.

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Reader Comments (1)

  • cautious
    May 3, 2018 - 7:26PM

    Its accumulated losses increased Rs11.52 billion to Rs319.10 billion in the quarter.
    .
    What’s it going to take for the govt to finally figure out that closing it down is better than letting this airline bleed the taxpayers? Parliament and SC may prevent sale but nobody can force the govt to write checks to keep funding this loser. Recommend

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