March 3rd, 2024

Flair Airlines owes feds $67 million in unpaid taxes, prompting seizure order

By The Canadian Press on January 29, 2024.

Court documents reveal that Flair Airlines owes Ottawa $67 million in unpaid taxes, prompting the federal government to obtain an order for the seizure and sale of the carrier's property. A Flair Airlines plane is shown in this undated handout photo at the at the Fort Lauderdale airport. THE CANADIAN PRESS/HO-Flair Airlines * MANDATORY CREDIT *

Court documents show Flair Airlines owes Ottawa $67.2 million in unpaid taxes, prompting the federal government to obtain an order for the seizure and sale of the carrier’s property.

The money relates to import duties on the 20 Boeing 737 Max jetliners that make up the budget airline’s fleet.

In an emailed statement, Flair CEO Stephen Jones says the Edmonton-based company has a deal with the Canada Revenue Agency to pay the taxes, and that it is “current with that plan.”

He says the Federal Court order obtained by the tax agency in November has no impact on the carrier’s operations, which have expanded over the past year and ramped up competition with rival airlines.

The order follows the repossession of four Flair planes last March after leasing manager Airborne Capital claimed that the company regularly missed payments over the preceding five months.

In response, Flair launched a $50-million court action against Airborne Capital and three other leasing firms, arguing that ongoing demands for payment from the four companies were “baseless.”

Canada Revenue Agency spokeswoman Kim Thiffault says the agency cannot comment on specific cases (for confidentiality reasons), but that it may garnish revenues or seize assets as a last resort if suitable payment arrangements (with a company) cannot be made.

This report by The Canadian Press was first published Jan. 29, 2024.

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