New tax regime reintroduces levies scrapped in 2020, says Air Peace CEO Onyema

Allen Onyema, Chief Executive Officer of Air Peace, has raised concerns that Nigeria’s newly introduced tax laws have reinstated charges abolished under the 2020 tax reforms.

Speaking during an interview on Arise News on Sunday, Onyema disclosed that the taxes include customs duties on imported aircraft, spare parts and engines, as well as the imposition of Value Added Tax (VAT) on air tickets.

According to him, the new regime also subjects aircraft imports to VAT, significantly increasing operational costs for airlines.

“There is now VAT on aircraft importation. If you purchase an aircraft worth $80 million, you are expected to pay 7.5 per cent of that amount,” Onyema explained.

He noted that airlines already operate under severe financial pressure, especially with loans obtained at interest rates of between 30 and 35 per cent, adding that the same VAT applies to imported spare parts.

Onyema warned that the aviation sector may not survive the additional financial strain, stressing that the implementation of the new tax reforms could cripple local airlines within months.

“If these tax reforms are fully implemented, Nigerian airlines will collapse within three months,” he cautioned.