The Airline Operators of Nigeria (AON) has reacted to claims that its members are indebted to the Nigeria Civil Aviation Authority (NCAA) for services rendered.
The association said in a statement in Lagos on Monday that all services rendered by the NCAA to domestic airline operators are fully paid for in advance on a cash-before-service basis.
AON also stated that the NCAA issues invoices for all regulatory services, including validation of crew operating licences, aircraft inspections, and documentation renewals.
It emphasised that airline operators are required to settle such charges in advance, adding that compliance has been strict.
“In practice, no domestic airline in Nigeria receives NCAA regulatory services without first making full payment.
“This long-standing policy and procedure remains firmly in place.
“Consequently, suggestions that domestic airline operators are indebted to the NCAA for regulatory services are factually inaccurate.
“What the NCAA refers to as ‘outstanding charges’ relates solely to the five per cent Ticket Sales Charge (TSC), a tax imposed on passengers for no services rendered,” it said.
The association noted that the tax is not in consonance with international aviation standards.
“This is entirely different from regulatory service fees,” it added.
AON further stated that several airlines maintained dedicated accounts from which the NCAA drew monthly remittances until the force majeure caused by the Iran/Israel/U.S. conflict that affected global aviation.
According to AON, the operators have appealed to the Federal Government through the Minister of Aviation and Aerospace Development to temporarily suspend payment of all statutory charges.
It said the suspension was to assist airline operators in managing cash flows during the period of severe financial stress caused by the increased cost of Jet A1 (aviation fuel).
The association said President Bola Tinubu had granted a 30 per cent concession, adding that it was awaiting the Federal Government’s decision on other aspects of its request for intervention.
It called on the Federal Government to amend the Civil Aviation Act to empower the NCAA to collect appropriate charges directly from passengers without routing them through domestic airlines, with effect from June.
“This will relieve domestic airlines of the financial burden of acting as collection agents for the NCAA, since airlines currently bear banking transfer charges and other transaction costs,” it said.
The five per cent Ticket Sales Charge in question was introduced over 45 years ago under the government of General Yakubu Gowon by the then Federal Civil Aviation Authority (FCAA).
“Its continued relevance has not been reviewed ever since.”
AON noted that the FCAA had evolved over time into several agencies, including the NCAA, the Federal Airports Authority of Nigeria (FAAN), and the Nigerian Airspace Management Authority (NAMA).
“With the creation of each of these agencies, separate taxes, fees, charges, and levies were introduced for Nigerian airline operators.
“Meanwhile, the five per cent TSC, which was originally a policy instrument, was surreptitiously introduced into legislation by the NCAA, despite vehement opposition from the AON and other industry stakeholders.
“Domestic airlines, in addition to this five per cent TSC, still pay separately and directly for services provided by the various agencies, including the NCAA.”
The association called on the Federal Government to review all forms of levies imposed on domestic airline operators.
“The financial impact of these taxes, fees, charges, and levies is adverse and burdensome, especially at this period when the entire world has been exposed to the exogenous shocks of the Iran/Israel/U.S. crisis.
“The aviation sector is crucial to the economy as a catalyst and enabler for economic growth. The survival of the sector therefore demands urgent and deliberate policy action,” AON said.
