Onyema: Local airfares may hit N1m when new tax laws take effect

Onyema: Local airfares may hit N1m when new tax laws take effect

The chairman of Air Peace, Onyema, warned that Nigeria’s proposed tax reforms on airline ticket fares could severely impact the aviation industry. He explained that increasing VAT on ticket fares to 7.5% would push economic-class tickets to around ₦1.7 million, significantly reducing demand and potentially causing Nigerian airlines to collapse within three months. He stressed that the burden would ultimately fall on passengers and could also negatively affect banks financing aircraft acquisitions.

Onyema noted that the Airline Operators of Nigeria (AON) had repeatedly raised these concerns with government authorities, including the National Assembly and the tax reform committee. While lawmakers and consultants acknowledged the risks, the chairman called for a return to the 2020 Act, which had previously respected the aviation sector. He urged the removal of VAT on ticket fares and imported aircraft and advocated for alternative channels to ease equipment acquisition costs.

He emphasized that aviation is a critical driver of economic growth and national integration, not merely a revenue source for government. Onyema praised the government for being responsive to past industry requests and called for policies that support the sustainability, growth, and local development of Nigeria’s aviation sector through fiscal, regulatory, and infrastructural measures, as well as encouragement of new investments.

            The Sun, 29 Dec 2025