Pakistan International Airlines (PIA) has been granted permission by the International Monetary Fund (IMF) to eliminate the 18 percent sales tax on leased aircraft.
According to ExpressTribune, this ruling is expected to eliminate all obstacles in the national flag carrier’s privatisation process. Since a real estate developer only offered Rs. 10 billion for a 60% stake in October 2024, the process has remained in doubt.
During a recent meeting, government officials informed Deputy Prime Minister Ishaq Dar of the latest developments and affirmed that PIA’s potential investors would be able to avoid the sales tax on new aircraft with the IMF’s consent. The IMF’s ruling comes after bidders had demanded that Rs. 45 billion in liabilities be written off as well.
Now, PIA’s restructuring could move forward immediately, including the transfer of Rs. 623 billion in liabilities to a holding company. The IMF was also briefed by the finance minister on the global problems brought on by the sales tax and the necessity of luring in foreign capital to revive PIA.
