FBR waives Rs8.77b penalties, surcharges on PIACL

In a major development, the Federal Board of Revenue (FBR) announced to waive all penalties and surcharges imposed on Pakistan International Airlines Corporation Limited (PIACL) with immediate effect, reported 24NewsHD TV channel on Tuesday.

The Federal Board of Revenue issued an SRO.799(I)/2026 in this regard. 

The FBR stated that the decision was taken under Section 183 of the Income Tax Ordinance, 2001, and in line with a federal cabinet’s decision dated December 31, 2025.

The federal government has exempted default surcharge and penalties on PIA’s current tax liabilities totaling Rs8,765,972,000, subject to final determination. 

The move is aimed at facilitating the successful completion of the airline’s divestment process to prospective buyers and ensuring the timely execution of bid-related accords.

Officials said the relief is part of broader efforts to streamline the privatization of the PIA, which has faced persistent financial challenges in recent years.

The FBR further clarified that the waiver is conditional. PIA must settle all its outstanding tax liabilities recorded as of June 30, 2025, within four years. 

The repayment plan includes a one-year grace period, after which the amount will be paid in equal annual installments.

The payment schedule will commence following the “First Completion” stage, as defined in the Share Purchase and Subscription Agreement between the Government of Pakistan and the successful bidder.

Reporter: Basim Iftikhar