The Digest:
The Airline Operators of Nigeria (AON) has raised concerns over the potential collapse of domestic airlines within 48 hours of the implementation of the new Tax Reform Act. The new tax structure, signed by President Tinubu in June, could devastate the sector's operations by January 2026.
Key Points:
- AON warns the Tax Reform Act could bankrupt airlines within 48 hours.
- The reforms, including customs duties on aircraft and spare parts, take effect from January 2026.
- Airlines are already facing excessive taxation, including the 5% ticket sales fee to the NCAA.
- AON Vice Chairman, Allen Onyema, decries the impact of marginal profits and heavy tax burdens.
- Onyema calls on the government to reconsider the tax measures before implementation.
- Bismarck Rewane stresses the need for consistent policies to boost investor confidence in aviation.
- The air transport sector experienced a 0.81% contraction in Q1 2025, the sixth consecutive quarterly decline.
- Minister Festus Keyamo is addressing AON’s concerns with the government.
The new tax reforms, if implemented as planned, pose a severe risk to the survival of Nigerian airlines. The government's response could shape the future of the sector, ensuring either its collapse or recovery.
Sources: Vanguard, Premium Times, Arise TV
