FBR seizes PIA bank accounts yet again

Move comes as national carrier fails to pay taxes worth Rs2.86b

KARACHI:

The Federal Board of Revenue (FBR) has seized the bank accounts of the Pakistan International Airlines (PIA) yet again for not paying its taxes amounting to Rs2.86 billion.

“The government dues amounting to Rs2,864 (M) are outstanding against M/S Pakistan International Airlines NTN: 0803450 for multiple tax periods,” read a letter written by  Deputy Commissioner Inland Revenue Unit-02 Sharjeel Ahmed to the bank’s manager.

“Now therefore, in exercise of powers conferred under Section 14(3) read with Rule 60(1)(d) of the Federal Excise Act, 2005, I do hereby issue/serve this notice for attachment of [the] bank account … and any other bank account maintained against NTN: 0803450 of the defaulter maintained with your bank if any, with immediate effect till the amount of tax is paid or recovered in full,” it further stated.

“It is requested to record, sign and stamp the balance amount at the time of service of notice in the bank account(s), and provide the bank statement for the period 01-07-21 till date reflecting [the] balance on the date of attachment … with immediate effect and issue [a] pay order in favour of the Commissioner Inland Revenue, Zone-I, Large Taxpayers’ Office, Karachi, under intimation to this office for further action,” it added.

In January last year, the FBR had frozen 53 bank accounts of the PIA after it was found to be a tax defaulter of Rs26 billion, only to restore them later in the day after the airline’s CEO met with the tax body’s chief.

The PIA CEO assured the FBR that the airline would continue paying its arrears despite the challenges it was facing and consult with the cabinet for guidance.

The freezing of the accounts would have affected the countryside operations of the airline.

There were also plans to issue arrest warrants for the PIA managing director for the recovery of dues.

In September 2021, the government had approved a Rs44 billion bailout package for the PIA in the shape of cash and sovereign guarantees after its failure to bring any improvement to the financial condition of the national flag carrier in three years.

The amount of Rs44 billion had been provided amid mounting losses of the PIA that had reached Rs542 billion by June 2020.

In order to facilitate the borrowing, the Economic Coordination Committee (ECC) of the Cabinet had extended the guarantee limit from Rs226 billion to Rs247.6 billion.

The money was planned to be borrowed from commercial banks on the back of sovereign guarantees of the finance ministry.