GOL Linhas Aéreas Inteligentes (G3, São Paulo Congonhas) has entered into separate agreements with Brazil’s National Treasury Attorney’s Office (Procuradoria-Geral da Fazenda Nacional—PGFN) and the Special Secretariat of the Federal Revenue of Brazil (Receita Federal—RFB) to resolve the tax liabilities of the carrier and its subsidiaries, which are currently in a Chapter 11 bankruptcy process.

The agreements cover social security-related taxes, non-social security-related taxes and other tax obligations and provide for the instalment payments of approximately BRL5.5 billion Brazilian reais (USD892.4 million), as well as the application of discounts on fines, interest, and charges, and the possibility of reducing part of the outstanding balance, the airline said in a filing on January 2.

The agreements will not impact GOL’s net debt of BRL27.6 billion (USD4.47 billion) and they are part of the company’s initial restructuring plan and overall Chapter 11 procedure, it added.

GOL’s proposed Chapter 11 plan looks to cut about USD1.7 billion of the company’s debt and up to USD850 million of other obligations by converting them into equity. The carrier looks to raise up to USD1.85 billion of new capital, supported by its majority shareholder Abra Group.