Chinedu Eze

As a country where air travellers pay the highest taxes in Africa and one of the highest in the world, according to the International Air Transport Association (IATA), Nigeria is yet to give passengers who travel to international destinations, the necessary respite.

With average of four million travellers on international routes since 2021, Nigerian travellers pay $480 million annually comprising Passenger Service Charge (PSC) of $100 and security tax of 20 per passenger every year.

The Federal Airports Authority of Nigeria (FAAN) generates about $400 million from PSC alone, while the Nigeria Civil Aviation Authority (NCAA) generates $80 million annually. The Nigeria Airspace Management Agency (NAMA) also collects en-route charges built into the tickets.

After the security incident involving Umar Farouk Abdulmutallab, popularly referred to as the “Underwear Bomber” or “Christmas Bomber”, the federal government introduced $20 security charge, which was supposed to be used to develop security infrastructure at the airports.

The payment was programmed to last for five years, but since it was introduced in 2010, the collection has continued 15 years after. Industry insiders say that in the last 15 years, there is no discernible infrastructure procured or installed with the money because every security equipment at the airport was procured by FAAN and, “Nigeria is even catching up in providing critical security equipment compared to other countries despite special fees paid by passengers for security.”

The Nigerian Civil Aviation Authority has announced the introduction of a new APIS Charge of $11.50, which will take effect from December 1. An APIS charge refers to a fee levied for accessing or using an Application Programming Interface (API). The circular that announced the charge did not make it clear if NCAA will discontinue the security tax of $20 or the passengers will pay this and also the $11.50 from December this year. It only explained that the fee, which will be collected at the point of ticket sale, will be remitted by airlines to the NCAA for the provision of Advance Passenger Information Services and it is expected to remain in effect for 20 years.

Also flexing its muscles and rearing to go is the Nigeria Airspace Management Agency, which has said that the N11, 000 it charges for navigational charges to airlines is no longer sustainable in the light of “current economic realities.”

Many industry insiders disagree with this increase, saying that Nigeria is a huge market because a country with about 250 million people, the annual passenger traffic on international routes has hovered around 4 million.

In 2021, Nigeria recorded 14, 249, 542, air travel according to records from the Nigeria Civil Aviation Authority. This was made up of 12, 050, 264 domestic passenger movement and 2, 199, 278 international passenger movement.

In 2022, Nigeria recorded about 16. 2 million in both domestic and international travel with over 12 million on domestic travel, while about four million travelled on international destinations.

But Nigeria recorded a total number of 15, 895, 265 passengers in 2023, which was less than 16, 172, 433 passengers that passed through the airports in 2022 and there are indications that the number of passengers who travelled by air in 2024 would be less than the previous year, going by the first, second and third quarters results released by NCAA.

When compared to other developing countries that have the population near or above that of Nigeria it becomes obvious that Nigeria is not recording passenger growth in air travel both for local and international destinations.

In 2023, Brazil recorded 112.6 million passengers on domestic and international flights, marking a 15.3 percent increase from 2022’s 97.6 million passengers, as reported by Minister of Ports and Airports Silvio Costa Filho.

In Indonesia, from January to August 2023, the number of domestic air transport passengers was 41.6 million, increasing by 22.46 percent. The number of international air transport passengers was 9.9 million and increased by 212.55 percent compared to the same period in 2022.

Egypt’s airports recorded tremendous growth in air traffic rates during 2023, receiving approximately 47 million passengers, an increase of 28 per cent compared to that of 2022, according to a statement issued by the country’s Ministry of Aviation.

One of the major reasons why Nigeria is not recording significant increase in passenger throughput is because of high cost of fares padded with heavy taxes and charges.

A country manager, in charge of one of the regional airlines, told THISDAY that the high charges being introduced by the Nigerian government is wrong in all aspects because the charges are injurious to the airlines; because passenger numbers will drop due to many charges.

“It is wrong in all aspects of it. They started collecting $20 security since 2010 after Abdulmutallab incident in 20 l0 to improve security infrastructure and implement advanced passenger information system. They said it would last for 5 years but this is 2025; the money is still being collected.  Now, they will implement this from December 1, 2025. It looks like double charge because the $20 has not been vacated, now this. IATA is against. It will affect passenger throughput especially regional operators. Some countries charge cents for API. There has been progressive reduction in passenger traffic since 2021 when FAAN increased PSC. $50 for regional and $100 for international flights. 

NAMA is increasing charges too. There is high percentage of people that are not flying, considering the population of Nigeria. Nigeria is over charging passengers. The middle class are still leaving the country. When all these people leave, who will be paying for tickets. The N712 billion airport rehabilitation, are you rebuilding the airport for who? What have they used the $20 security tax to do? What security infrastructure did they bring to the airport? Passenger throughout is low, purchasing power is low and you are increasing taxes, instead of reducing it,” the country manager said.

During the Business Webinar, last week on the new tax laws and how it affects aviation, organised by Aviation and Allied Business, the Managing Director, Overland Airways, Captain Edward Boyo, called on the federal government to reconsider its taxation policies on the aviation sector, warning that excessive levies and charges risk stifling an industry that is central to Nigeria’s economic growth.

Boyo had lamented that aviation is not treated as a priority sector in the nation’s economic framework and argued that no meaningful economic development could take place without a thriving aviation industry, describing it as a catalyst for business and investment.

“Every major investment or development in Nigeria relies on air connectivity. Yet, our industry is being suffocated by a taxation regime that makes it difficult to grow or generate the revenues needed to support the economy,” he said.

Captain Boyo stated that while operators are compliant with tax obligations, the current system leaves the industry struggling to survive, pushing jobs and opportunities out of Nigeria and across West Africa.

He urged the government to provide special import corridors for aircraft parts, as none are manufactured locally, and to introduce incentives that would allow maintenance, repair, and overhaul (MRO) facilities and other support services to thrive within the country.

He also warned that without urgent policy reforms, airfares would inevitably rise, not because airlines wish to increase costs but because they must cover expenses in a highly safety-sensitive industry.

“We must not tax aviation out of existence. The sector should be given priority if Nigeria wants to unlock growth, create jobs, and drive economic development”.

It has to be noted that the more government introduces taxes at the airports, the more the number of Nigerians that will be disenfranchised by the new economic reality from travelling by air.

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