19 June 2017

Nigeria: Osinbajo Pledges Multiple Taxation Review, Others in Aviation

Acting President Yemi Osinbajo has pledged commitment of the Federal Government towards addressing many challenges facing the aviation industry, especially multiple-taxation.

Osinbajo, who met with a delegation of airlines' chief executives and members of the Airline Operators of Nigeria (AON) in Abuja at the weekend, said the move was to enhance the ease of doing business in the air transport sector.

The Guardian had recently reported that at least 65 per cent of revenue accrued to local airlines goes to 35 different sundry charges under the guise of taxes and levies at airports nationwide.

Apparently in reaction, Osinbajo called the meeting to hear from the airline operators and investors why the sector was in dire straits in spite of the huge potentials.

Having listened to the operators, the Acting President acknowledged the difficult situation the airlines face and promised to take a closer look at the various issues raised in order to find ways of addressing them.

He said the environment has to be more friendly; promoting the ease of doing business in the industry, as well as repositioning Nigeria to take advantage of natural God-given geographical location as the hub in Africa.

Chairman of AON, Captain Nogie Meggison, said that more pressing was the need for the removal of Value Added Tax (VAT), as the local airlines are the only arm of the transport sector paying VAT.

Meggison also called for the harmonisation of over 35 multiple charges and review of five per cent Ticket Sales Charge (TSC) to a flat rate in line with global standard practices.

He also identified challenges with poor navigational and landing aids at airports, high cost and epileptic supply of JetA1 and obsolete infrastructure, all limiting operations to daylight activities for most airports, adding that local airlines fly an average of only five hours as against 10 hours worldwide per airplane.

Meggison said: "There is an urgent need for a deliberate economic policy that will support the positive growth of aviation and survival of domestic airlines in the country. For instance, following the air crashes of 2005/2006, government came up with a policy to ensure air safety. Similarly, the economic policy for the sustenance of the industry needs to be seriously looked into."

Other executives present at the meeting include Managing Director (MD) of DANA Air, Jacky Hathiramani; MD of Air Peace, Allen Onyema; MD of Azman Air, Yunusa Sarina Abdulmunaf; Area Manager, South West Africa of International Air Transport Association (IATA), Dr. Samson Fatokun and MD, Skyjet Aviation, Kashim Shettima.

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