Duterte administration secures P5.7 Billion tax settlement from PAL

Duterte administration secures P5.7 Billion tax settlement from PAL

And you just know that Change has really begun

Before the administration of President Rodrigo Duterte, The Philippine Air Lines has owed the government unpaid obligations amounting to billion of pesos. And it took a Duterte to be the president for it to be finally settled in favor of the government.

The Department of Transportation, the Civil Aviation Authority of the Philippines and the Manila International Airport Authority in a joint press statement issued that the Philippine Airlines settled today its outstanding debt to the government amounting to P6 billion since the national flag carrier incurred the arrears more than four decades ago.
The Tan led Philippine Airlines settles with the Philippine government last month its outstanding balance due to its unpaid navigational charges.(photo credit to owner)

A check amounting to P5.7 billion was turned over by lawyer Clara De Castro, PAL's vice president for legal affairs, to the office of CAAP in Pasay while a separate check worth P258.6 million was delivered to MIAA.

PAL's payment of its unpaid air navigational charges, which ballooned since 1970's up to July 30 2017, was made earlier than the December 2017 deadline, the statement noted.

A few months ago, the President had threatened to shut down Terminal 2 of the Ninoy Aquino International Airport, which PAL has been exclusively using since 1999, if the airline’s owner, business tycoon Lucio Tan, fails to pay his company’s obligations.

DOTr earlier said PAL’s unpaid navigational fees and other liabilities to the government have so far reached P7.3 billion as of Sept. 26, 2017, payable to the CAAP and MIAA.

Following the president’s threats against the airline, the Tan-led company early last month said it was ready to present a "compromise agreement" regarding its unpaid charges, which the DOTr accepted.

“One of the overriding reasons why PAL agreed to settle is to manifest its trust and confidence in President Duterte's administration,” PAL and the DOTr said in a joint statement last October 6.

“PAL assured the government and the traveling public that it will continuously provide its vital airline operations in the service of the Filipino people,” they added. *

According to DOTr, letters were sent to the Lucio Tan-led airline company upon the instructions of Transportation Secretary Arthur Tugade as early as August 2016 "demanding full payment of all unpaid charges." 

Malacañan in its statement regarding PAL’s payment "will go a long way to help build much needed infrastructure to support our economic capabilities."

"It is a clear reminder that when government prioritizes national interest citizens will cooperate," Presidential Spokesman Ernesto Abella said in a statement, last month.


 report from Philstar

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