Biggest private airline in Afghanistan grounded over non-payment

Aviation authority loses patience after Safi Airways fails to pay taxes and debts over two years despite being warned the authority would take action.
A Safi Airways Airbus A 320 at Kabul International airport. The Afghan aviation authority has suspended operations of the carrier. Alexander Klein / AFP
A Safi Airways Airbus A 320 at Kabul International airport. The Afghan aviation authority has suspended operations of the carrier. Alexander Klein / AFP

Afghanistan’s largest private airline has been forced to suspend operations after it failed to clear outstanding debt and taxes.

The Afghan civil aviation authority (ACAA) ordered Safi Airways on Sunday to pay 1.15 billion Afghani (Dh6.2 million) before it can regain permission to resume services and sell tickets.

The ACAA has said that it took the action against Safi Airways, one of the country’s major airlines, for failing to pay taxes amounting to 1.6 billion afghanis ($16.7 million).

Since Monday, domestic flights were to be grounded and “on September 8 all international flights are suspended”, the ACAA said.

It said the airline had failed to pay its taxes and debts to the ministry of finance over a two-year period from March 2011 to March 2013, even though it had been repeatedly warned “to take action”.

The Afghan government has given the company one month to “pay its debts and taxes through the previously agreed upon terms” or else “the tax department can request seizure and sale of all airline assets via the court”.

Safi Airways operates 74 flights each week to seven domestic and international destinations.

“The finance ministry decided to suspend Safi Airways activities in Afghanistan,” the independent directorate of civil aviation said. It added that authorities can also stop the company’s executives from travelling outside Afghanistan.

The finance ministry has allowed the tax office to seek court approval to confiscate and sell Safi Airways property if it fails to meet the payment deadline.

The airline, which was founded in 2006, is the country’s second-largest after the national carrier Ariana Afghan Airlines.

Safi Airways transports many expatriates and benefits from the presence of non-governmental organisations, private security companies and other foreign entities in Afghanistan.

Last year, the company said it was looking to add 10 to 20 planes in three to five years to expand business in Iran, Kuwait and Kazakhstan.

buisness@thenational.ae

Follow The National’s Business section on Twitter

Published: September 6, 2016 04:00 AM

SHARE

Editor's Picks
NEWSLETTERS
Sign up to:

* Please select one

Most Read