Once Again, PIA Bank Accounts are Seized by FBR

The Federal Board of Revenue (FBR) once again seized the bank accounts of Pakistan International Airlines (PIA)

The Federal Board of Revenue (FBR) once again seized the bank accounts of Pakistan International Airlines (PIA). As a result, the airline has been unable to pay its outstanding taxes totaling Rs 2.86 billion. Several government dues were outstanding against M/S Pakistan International Airlines for multiple tax periods, according to the FBR’s notice to the bank’s manager.

Under the Section 14(3) read with Rule 60(1)(d) of the Federal Excise Act, 2005, the Deputy Commissioner Inland Revenue Unit-02 Sharjeel Ahmed exercised the powers conferred to serve this notice for attachment of the bank account of the defaulter. This includes any other bank account maintained against the National Tax Number (NTN) 0803450 of the PIA maintained with the bank.

As stated in the notice, the bank accounts will remain attached until full payment of the tax has been made or recovered. Additionally, the bank is asked to record, sign, and stamp the balance amount at the time the notice is served on the bank accounts.

The bank statement for the period of 01-07-21 until the date of attachment reflecting the balance is required immediately. A pay order is also requested by the FBR in favor of the Commissioner Inland Revenue, Zone-I, Large Taxpayers’ Office, Karachi, under notification to this office.

The PIA had 53 bank accounts frozen by the FBR in January of last year after the company was discovered to have a Rs 26 billion tax debt. The accounts were later reinstated, though, following a meeting between the CEO of the airline and the head of the tax agency. The CEO gave the FBR his word that despite the difficulties it was having, the airline would keep up with its payments of arrears and seek advice from the cabinet.

In September 2021, the government approved a Rs 44 billion bailout package for the airline after the PIA failed to improve its financial situation in three years. Given that the airline’s losses had reached Rs542 billion by June 2020, this included cash and government guarantees.

The Economic Coordination Committee (ECC) of the Cabinet increased the guarantee limit from Rs 226 billion to Rs 247.6 billion to make borrowing easier. It was intended to borrow the funds from commercial banks using the finance ministry’s sovereign guarantees.

There are plans to issue arrest warrants for the PIA managing director for the recovery of dues if the PIA fails to pay its unpaid taxes and abide by the FBR’s notice.

Written by Aly Bukshi

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