FBR freezes PIA bank accounts over non-payment of FED

• Bank accounts frozen due to non-payment of Rs8 billion in FED.
• FED was not submitted despite accounts being restored last month, says FBR.
• PIA accounts associated with IATA also to be frozen.

KARACHI: The Federal Board of Revenue (FBR) Thursday froze 13 bank accounts of Pakistan International Airlines (PIA) due to non-payment of Rs8 billion in Federal Excise Duty (FED).

According to FBR officials, the national carrier's bank accounts associated with the International Air Transport Association (IATA) would also be frozen.

“A decision has been made to register a first information report (FIR) against PIA officials for not submitting the FED,” said the FBR officials. “The FED was not submitted despite the accounts being restored last month.”

According to a PIA spokesperson, the freezing of the national carrier’s bank accounts would not affect its flight operations.

“There is contact at the government level. PIA’s accounts would be restored soon,” the spokesperson added.

It should be noted that on July 27, the FBR had frozen all bank accounts of the PIA over non-payment of taxes, sources had told Geo News.

Subsequently, on July 28, the accounts were restored following the settlement of issues between the FBR and PIA, according to sources. 

In recent years, mismanagement of funds, a rise in operating costs and a surge in fuel prices have led to financial difficulties for the national carrier.

The PIA also faces scrutiny over its compliance with international safety standards, leading to temporary bans and restrictions on Pakistani airlines in various countries.

The national flag carrier, in response, had claimed that its flights continued uninterrupted despite the tax bureau freezing its accounts.

The sources in the FBR said the PIA had not deposited the FED of Rs4 billion, which it had collected through plane tickets.

The PIA faced difficulty in paying for its planes' fuel as the sources said that the Pakistan State Oil (PSO) had refused to supply the same when its accounts were frozen last time.