High airfare: Airlines lie about multiple taxes – NCAA
The Nigeria Civil Aviation Authority (NCAA) has pushed back on domestic airlines’ claims of excessive taxation as reason for the recent imposition of prohibitive fare on air passengers.
Addressing the matter via a post on his X handle, spokesman for the Authority, Mr Michael Achimugu, said the airlines are making unsubstantiated claims.
“Lies have been told over this matter, over and over. I have addressed this on national television, major news platforms… While the NCAA does not regulate airfares, I have invited all of the domestic airlines, bar none, and asked them about these taxes they keep talking about on television. They ALL admitted to NOT paying the volume of taxes being bandied around,” he said.
Achimugu was reacting to the interview the chairman of Air Peace, Mr Allen Onyema, granted to a television station during which has he said airlines retain only a fraction of ticket revenue due to existing deductions.
“From a ₦350,000 ticket, operators might keep as little as ₦81,000 after mandatory charges like the 5% ticket sales charge to the NCAA and other levies. “We are suffering multiple taxation, multiple charges… Almost 65 to 70 per cent of that money is not coming to the airlines,” he said.
Onyema also spoke on the reintroduction of 7.5% value added tax (VAT) on air ticket fares, aircraft imports, engines, and spare parts—a reversal of previous exemptions—as a major threat.
“There’s VAT now on the importation of aircraft. So if you buy an aircraft for $80 million, you are supposed to pay 7.5% of $80 million.
Why? Should the plane not just be charged import duty? “Funds borrowed from the bank are 30–35%. So you bring in spare parts, and you pay 7.5% on them. Ticket fares will hit $1.7 million soon. At 35%, we are choking. You don’t do that,” he added.
Despite all the challenges, including multiple taxes, Onyema said the current domestic fares remain relatively low globally when adjusted for operational realities, with entry-level tickets still available from around ₦125,000 to ₦150,000 on some routes.
In his reaction, Achimugu said the airlines were misleading the public and shifting blame to government.
“I don’t understand this 350k and 81k narrative, but I know that, for the kind of support that President Bola Ahmed Tinubu; the aviation minister, Festus Keyamo; and the DGCA, Capt. Chris Najomo have given to domestic carriers, I see no reason why the government keeps getting thrown under the bus via statements like this.
“If high taxes were the reason why airfares were 150k-200k, why did tickets sell for as high as 500k for a 45 minute trip when the said taxes did not increase?” Achimugu said.
On the notion that domestic airfares are the lowest comparatively, the NCAA spokesman said: “It is even ironic that, in the same statement, it is alleged that Nigerians pay the lowest domestic airfares in the world while also justifying the astronomical airfares that came to play in December even though there was no hike in taxes or jet fuel.
“If my inviting the airlines themselves, speaking with travel agents, and the relevant departments within the Authority did not agree with the narrative being pushed, I don’t see how this is sustainable.
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