The Nigerian Government is set to exempt all forms of transport from paying Value Added Tax (VAT) following President Muhammadu Buhari's signing of an Executive Order early last month. The order must, however, still pass through Nigeria's National Assembly before it can be enacted into law.
In a statement hailing government's positive first steps, the Airline Operators of Nigeria (AON) said the removal of VAT would help make air travel more affordable thus benefitting the Nigerian aviation industry as a whole.
“We, as Nigeria, have been crying out for decades now for discussions on the immediate removal of VAT from domestic air transportation in line with global best practice, but we have barely been heard over the years," AON Chairman, Capt. Noggie Meggisson, said in a statement. “VAT is an added burden on our passengers who have limited disposal funds and have reached their elastic point in this difficult time in the nation’s economy. This adversely affects the sector by reducing the number of those who can afford to travel by air due to high fares in this tough economic time.”
“It is our prayer that the president will go a step further to encourage the National Assembly to pass this Executive Order into law as quickly as possible."
“This will go a long way to encourage more Nigerians to fly and put the airlines on a positive footing to grow the economy and contribute to the Gross Domestic Product (GDP).”
AON, whose member carriers include Med-View Airline, Air Peace, TopBrass Aviation, JedAir, Dana Air, Azman Air, First Nation Airways, and Overland Airways, had earlier resolved to stop paying VAT remittances to government citing what it said was the unfair targetting of the aviation sector for the added taxation.
