“Flying Into Crisis!” — New Tax Policies Threaten To Clip Nigeria’s Aviation Wings

New Tax Reforms May Cripple Aviation Industry, Lead to Mass Layoffs — Operators Warn

ACCORDING TO IREPORTER ONLINE, Nigerian airline operators have raised serious concerns over the recently signed Tax Reform Acts by President Bola Ahmed Tinubu, warning that the new legislation could lead to the collapse of the aviation industry and trigger widespread job losses.

The operators criticized the reintroduction of Value Added Tax (VAT), the payment of customs duties on imported aircraft and spare parts, and the elimination of critical waivers previously granted to the sector.

They argued that such measures run contrary to global standards, noting that ICAO discourages VAT on air transport and that, in Nigeria, only the aviation sector bears such a burden.

ACCORDING TO IREPORTER ONLINE, Captain Ado Sanusi, Managing Director of Aero Contractors, described the reforms as a “potential disaster,” saying they would increase operational costs, make aircraft procurement more difficult, and ultimately render thousands of Nigerians jobless.

He emphasized that while the government may benefit from increased revenue, it risks creating severe economic and social instability by choking vital industries.

Sanusi further warned that government aviation agencies such as the NCAA and NAMA, already financially strained, would be further weakened under the new framework, which mandates that all internally generated revenues be paid into a consolidated account — a move he said undermines ICAO’s cost-recovery model.

Engr. Akin Olateru, CEO of OmniBlu Aviation, also echoed similar sentiments. He acknowledged the intent behind the reforms but criticized the lack of consultation with industry stakeholders.

“This reform will kill the airline sub-sector if waivers are withdrawn,” he warned. Olateru noted that the additional tariffs would be passed on to passengers, inflating airfare and depressing demand.

ACCORDING TO IREPORTER ONLINE, Capt. Samuel Caulcrick, former Rector of the Nigerian College of Aviation Technology, took a more optimistic view, stating that the new laws could potentially modernize tax administration and bring long-term improvements if properly implemented. However, he admitted that the aviation industry remains among the most overtaxed in the world and is already grappling with numerous levies.

President Tinubu signed the four new Acts — Nigeria Tax Act, Nigeria Revenue Service (Establishment) Act, Nigeria Tax Administration Act, and Joint Revenue Board (Establishment) Act — into law on June 26, 2025.

While the reforms are being touted as a historic step toward fiscal transformation, aviation stakeholders say the sector must be exempted before the January 2026 rollout to avoid irreversible damage.

”IREPORTER REPORTS”