NIGERIAN airlines are groaning under the weight of more than 54 taxes, fees and regulatory charges imposed by government agencies, with industry operators warning that the multiple levies are driving up airfares, squeezing profit margins and threatening the survival of domestic carriers.
Chairman of Air Peace, Allen Onyema, disclosed this in his keynote address at the 30th Annual Conference of the League of Airport and Aviation Correspondents (LAAC), in Lagos, on Thursday, where he called for urgent harmonisation and reduction of aviation taxes and charges to create a more sustainable operating environment for airlines.
He said the aviation industry, which contributes about $2.5 billion annually to Nigeria’s Gross Domestic Product (GDP) and supports more than 217,000 jobs, should be treated as a catalyst for economic growth rather than primarily as a source of government revenue.
According to him, aviation generates substantial indirect economic benefits through tourism, hospitality, cargo, trade, employment and national connectivity, making the survival of airlines critical to the wider economy.
Onyema argued that while government taxation and regulatory charges are necessary to fund public infrastructure, safety systems and regulatory institutions, excessive and overlapping charges could ultimately become counterproductive by weakening the airlines that sustain the aviation ecosystem.
‘You don’t use airlines per se to raise revenue for the nation. Airlines are not used to raise revenue directly, but indirectly. They energise the ecosystem for government to make money through tourism, economic integration and so many other things,’ he said.
The Air Peace chairman disclosed that Nigerian airlines currently contend with about 54 different taxes, fees and charges imposed across major government institutions, including the Nigeria Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA) and Nigeria Revenue Service (NRS).
He said FAAN alone collects about 18 different payments from airlines, covering services ranging from electricity, counter usage and boarding bridges to office rent, parking, landing, cargo and terminal-related charges.
NAMA, he added, collects five major charges, including en-route, terminal navigation, overflight, clearance and extension charges, while airlines also pay corporate income tax to the NRS.
For the NCAA, Onyema listed the five percent Ticket Sales Charge (TSC), five percent Cargo Sales Charge (CSC), five percent Excess Baggage Charge (EBC), licensing and medical certification fees, aircraft certification charges, Air Operator Certificate (AOC) fees, maintenance organisation charges and other regulatory payments.
He said only about six of the numerous charges are directly incorporated into every flight ticket sold in Nigeria.
These include Passenger Service Charge (PSC), Common User Terminal Equipment (CUTE) charges, Passenger Terminal Facility Charge, five per cent TSC, five per cent EBC and the $20 NCAA security levy.
He further cited the $11.50 Advanced Passenger Information System (APIS) levy, introduced by the NCAA in December 2025, as another charge affecting the cost of air travel.
According to him, the cumulative effect of the charges could add approximately N25,000 to domestic tickets, depending on the route and airline, while taxes and statutory charges on international journeys could reach $150-$180.
High costs threaten airline survival
Onyema said the cost burden had contributed to the high mortality rate among Nigerian airlines, noting that more than 60 carriers had shut down or become defunct over the years.
He said African airlines already operate at a significant cost disadvantage compared with carriers in other regions, while high taxes, aviation fuel prices, insurance and aircraft leasing costs further erode their margins.
Also speaking at the event, the executive chairman of United Nigeria Airlines, on dismissed allegations that domestic operators failed to remit the five percent Ticket Sales Charge (TSC) to the Nigeria Civil Aviation Authority (NCAA), insisting instead that Nigerian airlines had maintained full compliance with the regulatory agency before recent labour disputes.
In his presentation, Prof. Okonkwo said that prior to February this year, all airlines were meeting their financial obligations to the government without issue.
According to Okonkwo, payment difficulties emerged only when airlines began to have issues with the cost of aviation fuel which had increased to N3,300 as a result of the US-Iran crisis. He said the Airline Operators of Nigeria (AON) was the first to raise concerns about the financial burden of regulatory charges during the downturn.
‘Before February this year, there were no payment problems. All airlines were paying. The AON issue only became a problem because of the Gulf crisis. AON was the first to cry out. We wrote to the President, explaining that we could no longer pay these charges. We requested either a complete suspension of charges or temporary relief during the aviation crisis, and the request was granted. The President agreed and waived 30%,’ Okonkwo disclosed.
Following the presidential waiver, Okonkwo said airlines had a meeting with the NCAA and the Ministry of Aviation to establish a structured repayment framework. ‘We met with NCAA and the Minister. We held several meetings. In one decisive meeting, NCAA requested that airline operators pay 10% of the legacy debts within a specified period, and then pay the rest in instalments over a period of time and each airline was to meet with NCAA’s director of finance.
‘The airlines complied with this directive. The airlines did this. The director met with operators in Lagos and Abuja, and we developed a payment plan. This plan was in place. When you have a payment plan in place, it does not mean you will default. We were making regular payments according to the agreement we had with the NCAA until we heard about the labour union, problem,’ he said.
To demonstrate commitment, he revealed that United Nigeria Airlines established a proactive payment mechanism with NCAA. ‘At United Nigeria, to ensure no issues, we opened joint accounts with NCAA at Nigerian banks. The account was structured so NCAA could withdraw funds directly without asking us,’ he explained.
Prof. Okonkwo who is the spokesperson of the AON disputed characterisations that operators were non-compliant. He said: ‘When people discuss money not remitted or paid by operators, they fail to mention how much operators do pay. When they talk about unpaid money, I ask: what have you done with all that we have already paid? That is the proof, and that is my concern.
‘Beyond what we pay, we do not receive adequate value. When different stakeholders and agencies are asked to explain this, they simply say the government takes a large chunk of this money. The question is: for what?
‘Most of you here know that money charged is supposed to provide recovery. When we request NCAA to inspect our aircraft in London or America, they come, and we pay them. We do all this 100% in advance. But when you speak of a 5% charge, it remains unclear.
‘When you take 5% of any business, a business I borrowed money to run, a business that costs me sleepless nights, that is too much for anyone to extract from it. And this is on top of taxes we already pay. The call for removal of this 5% must not stop. It must continue until we remove it. We would not be able to have smooth operations until this is resolved.’
Okonkwo went further to state that the unions desire to advocate for airline worker welfare is understandable. He however said that airlines are among Nigeria’s best-paying sectors.
He said: ‘That shameful display at the airport by unions would have brought us to our lowest point if not for the reactions and condemnation from so many gathered here.
‘I especially commend the Aviation Roundtable President whose loud voice was heard worldwide. I also commend aviation reporters who reported fairly but we expected condemnation from quarters that should have known better but that did not come and we remain concerned.’