Thursday, August 11, 2022

Excessive, Multiple Taxation Undermining Airline Operations, Operators Lament 

Murtala Airport Lagos FAAN

The chief executive officer of Air Peace and vice president of the Airlines Operations of Nigeria (AON), Chief Allen Onyema, has pointed out that excessive and multiple taxations remain one of the major challenges preventing the air travel business in Nigeria from being a profitable venture.

Onyema made this statement at the FAAN National Aviation Conference (FNAC) in Abuja, themed “Advancing the frontier of possibilities for safe, secure and profitable air transport”.

The AON’s mandate is to promote the aviation and airline business in the country, so multiple taxations can be tackled and airlines do not suffer most of these challenges.

The president of AON, Alhaji Abdulmunaf Yunusa Sarina, who was represented by Onyema, said: “[How can] You pay about 37 charges in your own country? The modality rate on the airlines is alarming. Over 70 airlines have gone down. This is a capital-intensive industry and, as such, we need all the help we can get.

“The current fuel situation will take down no less than or, at least, 3 more airlines in the coming months or weeks. It is very scary. We shouldn’t allow this to happen; we must protect jobs.

“The Federal Government, under President Buhari, has done a lot for us. He has removed some taxes like customs duties and VAT on imported aircraft and imported aircraft space. The president signed these into law. 

“How will the airlines survive with multiple charges bringing us down? It is not all about the government. What about trying state governments where we operate from? They tax everything and that does not help us. 

“For the insurance, majority of the percentage of the insurance put together cannot claim one aircraft. Recently, we had claims to make; the foreign insurance companies we pay to have paid us the 15 per cent but the Nigerian insurance company has not paid. The current [insurance] charges in the industry must be brought down because we guard the issue of safety very jealously,” he stressed.

A representative of the Aviation Fuel Marketer Association of Nigerian (AFMAN), Engr John Abengode said that aviation fuel is a prestigious business. 

“We don’t have aviation fuel in Nigeria. Everybody is talking about aviation fuel but nobody is talking about diesel. Today, diesel is N800 per litre, while aviation fuel is 700-and-something naira.

“We are appealing for everybody to have an understanding while we look at how to manage the commercial airlines. It is for us to produce what we can consume that will eliminate these issues. 

“We don’t want to compromise quality because that will be disastrous,” Abengode disclosed.

Oluchi Okorafor
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