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Over Taxation Hitting Hard on Nigerian Airlines – Onyema, Airpeace CEO

The Chairman of Airpeace Ltd, Dr. Allen Onyema has stated that Nigerian Airlines are being overtaxed by regulatory agencies and this affects the aviation financing systems negatively.

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He opined that payment of tax is necessary but it should amount to cost recovery for airlines operations to be sustainable.

While speaking during a panel session at the 29th Annual League of Airports and Aviation Correspondents (LAAC) conference,he revealed that Airpeace faces several difficulties which involves infrastructure, multiple charges and dearth of foreign exchange, among others. He noted that these difficulties have restricted the advancement of indigenous airlines.

“The 5% we pay for the ticket fares to Nigeria Civil Aviation Authority (NCAA) is affecting airlines.It is limiting our ability to charge for the tickets.The other way around, they’re collecting from the passengers directly so that whatever we collect from the passengers will belong to us. I have not said that we should not pay anything to companies, but it has to be cost recovery. All over the world, even what the accountants do is about cost recovery.

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“The government needs to come to the aid of the airlines by creating a special window for them where they can easily access foreign exchange at a cheaper rate. On our own too, the airlines should have financial discipline, while the government can also come in through the central Bank of Nigeria (CBN) and the African Development Bank (AfDB) and other means to assist the airlines to remain in business.”

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Mr. Chris Aligbe , Chief Executive Officer of Belujane Konzult who also spoke during the session emphasised that the aviation industry is a sub-sector which closely links with each other. He explained that if the airlines are not doing well, the airport is not going to do well and this applies to the companies involved.

He reiterated that without formidable airlines, Nigeria will never get a hub where airlines can concentrate their operations and connect passengers from various origins to their final destinations.

Aligbe kicked against the idea of Nigeria having an aviation bank.According to him, Nigerian Airlines might not be capable of funding or supporting an aviation bank.He advised that a special window is created in order for airlines to access forex.

“I do not believe those who say let us have an aviation bank. There have not been enough to support an aviation bank. There should be a special window for modernizing on forex so that airlines that have money will go there, access forex, and be able to repair their aircraft and carry out other financial related issues.

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“For me, the airlines should be the breaking point. We might be modernizing our airports but if flights are not going there, the airports will deteriorate and that is what is happening in our country. I think that if we don’t build up our airlines, we will not get to where we are going to be. No airport in this country will become a hub if we keep depending on a foreign airline.

“I believe that our country is ripe enough to have three formidable airlines. Not less than three formidable airlines that can serve the country.”, he said.

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