NCAA carpets airlines on 5% ticket sales tax

THE Nigerian Civil Aviation Authority (NCAA) has lashed at domestic airlines over what it called a steady dose of misinformation about the 5 per cent Ticket Sales Charge (TSC) explaining that it was never a tax on airlines as they would have Nigerians believe.

Putting the record straight, the general manager, Public Affairs at the NCAA, Sam Adurogboye said that contrary to the ongoing misinformation, that the TSC charge is a charge on passengers collected in trust by airlines to be remitted to government so as to ensure facilitation is not hindered at the airports.

Speaking on the barrage of taxes being slammed on the domestic airlines by the aviation agencies, Adurogboye insisted that contrary to the misconception that such taxes are only synonymous with the Nigerian business environment that the airlines at inception were told of the existence of such taxes.

After the takeover of Arik Air by the Asset Management Corporation of Nigeria (AMCON), domestic airlines under the aegis of the Airline Operators of Nigeria (AON) had come out and criticized in strong terms the charges in the industry attributing the many failures of airlines business to multiple taxation and other unfriendly taxes not found anywhere else in the world but Nigeria.

Adurogboye who insisted that some of the airlines were just being economical with the truth especially with the 5 per cent TSC, said: “The business is highly capital-intensive. There is no operator that did not know about the charges before they commenced operations nothing new has been added. There is an emerging carrier that is growing today, he operates like a passenger and staff and they are growing. “

“Five percent ticket sales charge is not paid to NCAA by the airlines as tax, it is a charge added to the passengers determined airfare. When passengers pay five percent how does it become a charge? The airlines brought up the idea that to enhance passengers’ facilitation at the airport, they will collect the five percent on our behalf, after which the monies will be remitted to us, which we all agreed to in 2001. The money is for the sustenance of the CAA.”

According to him, for the CAA to be autonomous in truth according to the dictates of the Civil Aviation Act, it needed to source its funding autonomously and the 5% which used to be collected from passengers at the airport prior 2001 was the way to ensure non-interference.

“We had to compare what obtains in Canada, United States, South Africa and other places, all CAA are meant to be autonomous and it cannot be autonomous if we are not financially autonomous. We exist because of the safety of passengers and the passengers pay for the CAA to run.”

“The day they say government should start giving us money, then we become non-autonomous. The five percent ticket sales charge is in the act passed by national assembly. If not for the foreign airlines that pay as at when due, they (domestic airlines) would have grounded NCAA in Nigeria. “