ISLAMABAD:
The National Assembly’s Standing Committee on Defense has investigated the financial challenges facing the aviation industry, including PIA, with a particular focus on the existing tax system.
The committee, which met with Fateh Ullah Khan Miankhel as chairman, acknowledged the efforts of the Ministry of Defense to conduct a transparent tendering process for PIA.
Members noted that although ticket prices have not increased significantly in dollar terms, the imposition of taxes, including sales taxes, has placed a significant burden on airlines.
It was agreed that a comprehensive study of the taxation scheme and its impact on the aviation sector should be prepared and presented to the Minister of Defense and subsequently to the Prime Minister.
The NA panel also appreciated the statement by the new owner to take care of employees as well as improving aircraft operations in the near future.
The Committee reviewed the implementation status of previous recommendations relating to private carriers and key operational issues in the aviation sector, and discussed issues relating to flight regularity, cancellations and delays, fare structures and fleet resilience, with particular concern expressed over high domestic air fares and their impact on passengers.
The committee was informed that the Arif Habib consortium had won the bid from Pakistan International Airlines (PIA) for Rs135 billion.
The role played by the civil aviation authority and aviation operators in ensuring quality of service, consumer protection and continuity of domestic operations along with international expansion was emphasized. The committee also discussed public complaints and emphasized the need for improved monitoring and regulatory oversight.
The chairman was also tasked with arranging a meeting with the finance minister and relevant authorities to discuss possible tax rationalizations and to brief the committee on the results.
Issues relating to the wider aviation sector were also discussed, including medical facilities at aviation installations, radiation-related concerns and the need to address shortages of trained and qualified personnel.
The Committee decided to undertake visits to relevant land facilities as part of its oversight role to assess conditions first hand and recommend corrective measures. The proceedings of previous parliamentary forums and their recommendations were appreciated by the members.
The committee also discussed the privatization of PIA, including the treatment of liabilities and the proposed use of the proceeds for debt servicing and social sector development.
Project implementation challenges were reviewed with an emphasis on prioritization of ECNEC approved projects in the defense and aerospace sectors. The Ministry of Planning and the Ministry of Defense were directed to review ongoing projects, including strategic airports and the National Aviation Security Academy, provide updates on fund utilization and seek timely release of necessary allocations.
The committee also decided to review and approve pending sub-committee reports at the next meeting and to follow up with the Prime Minister’s Office and the Ministry of Finance regarding relaxations of the recruitment rules for the defense and the police, with results to be shared with the ministries concerned.
