ISLAMABAD: The bank accounts of the national flag carrier have been frozen for over a week now as the airline’s row with the Federal Board of Revenue (FBR) over tax arrears deepens.

Sources told Dawn that Pakistan International Airlines (PIA) owed around Rs2 billion in taxes, but that even after the payment of Rs2.14bn, the FBR was not unfreezing their accounts.

A senior PIA official said that Rs1.13bn was paid in October, while another instalment of Rs1.1bn was paid in November. However, the officer claimed that the FBR was asking for another Rs70 million before it would restore the accounts that had been frozen on Nov 6.

“At a time when the process of reviving PIA’s lost glory was taking off, this step has landed the airline in serious trouble,” he remarked. He said the administration had decided to take up the matter with the Ministry of Finance.

Airline claims FBR not unfreezing accounts despite payment of outstanding amount

The official pointed out that a number of steps were being taken to provide modern facilities to travellers.

He said the PIA fleet had increased its strength from 18 aircraft in 2013 to 37 aircraft now, adding that by the end of the year, the number of aircraft would go up to 40.

He said services at various airports across the country had been improved and the frequency of flights on profitable routes had been increased while flights on non-profitable routes had been discontinued.

“Under this strategy, flights going to Hong Kong, Bangkok, Kathmandu, Frankfurt, Amsterdam, and Glasgow have been discontinued and those flying to profitable routes such as Doha, Abu Dhabi, Muscat, Dubai, Beijing and Kuala Lumpur have been increased.”

PIA also had offline offices, located in those places where the airlines did not operate. Many of these, including offices in Sydney, Frankfurt, Bangkok, Hong Kong, Kathmandu, Amsterdam and Chicago, had been closed to reduce the financial burden, he said.

Published in Dawn, November 22nd, 2015