KABUL - Safi Airways, a privately-owned international airline, on Wednesday asked the Ministry of Finance to reduce taxes and let the company pay its arrears in installments as per the Cabinet decision.
The Finance Ministry says the Safi Airways is yet to clear taxes amounting to 400 million afghanis in parking and airport fees.
The airline’s officials say the company has approached the Council of Ministers and the departments concerned for a cut in taxes and allowing the company to pay arrears in installments.
They add the Cabinet and all other departments concerned have insisted on cooperation with the company.
Farid Nazari, marketing manager at the Safi Airways, said: “Three years back, the Council of Ministers ordered the Finance Ministry to reduce taxes of the airlines from 10 percent to five percent. But unfortunately it has not been done.”
In a letter, seen by Pajhwok Afghan News, the Council of Ministers has called for the tax on profit to be reduced from 10pc to 5pc and it collection in installments.
On the letter, the first vice-president’s office has written: “based on decision of the Council of Ministers, the previous years’ taxes payable by the Safi Airways should be calculated and received in 15 years in installments.”
Farid Nazari said they had been expecting the Finance Ministry to act upon the Cabinet decision, but instead the company was subjected to heavy tax penalties.
He said unhealthy competition between airlines, weak market, a spike in fuel prices, foreign completion and the lack of sufficient passengers were among the challenges the companies faced.
He added their current income could not meet their expenditures, that was why the company was in losses. He urged the Finance Ministry to support investors facing financial challenges.
But Deputy Finance Minister Gul Maqsood Sabet said the taxes had been reduced to five percent in compliance with the Council of Ministers’ directives.
Regarding the airlines’ demand to pay reduced taxes from the date the Council of Ministers took the decision, he said: “law is above the Cabinet. When laws are amended, we implement them from that specific day onwards.”
Earlier the Finance Ministry had said the Safi Airways defaulted on huge amount of taxes in parking and airport fees over the past four years. (Pajhwok)