(Eagle News) — Philippine Airlines has agreed to pay the government nearly P7 billion to settle its debts, an amount the Department of Transportation has accepted.
PAL and the DOTr made the announcement in a joint statement on Friday.
According to the statement, the P6.91 billion covers the navigational charges the flag carrier owes the Civil Aviation Authority of the Philippines and the Manila International Airport Authority, some of which date back to two years ago.
“…PAL commits to keep all transactions updated and current with the CAAP/MIAA,” they added.
They said “one of the overriding reasons why PAL agreed to settle is to manifest its trust and confidence in President Duterte’s administration.”
The announcement of the settlement between PAL and the DOTr comes after Justice Secretary Vitaliano Aguirre announced that Mighty Corp., which Duterte had hit for its tax liabilities, paid the same and its penalties in the amount of P40 billion.
It also comes a week after Duterte threatened to shut down the Ninoy Aquino International Airport’s Terminal 2—which PAL uses—if the airline does not pay its debts.
Earlier, PAL offered to pay the government P4 billion, less than the P6.91 billion the DOTr was demanding from it.
The flag carrier had argued only P3.6 billion of the P6.91 billion was backed by receipts.
The DOTr rejected this offer.
