The Federal Government has assured that new tax reforms, effective January 1, 2026, are designed to reduce airline operating costs rather than increase fares.
The Presidential Fiscal Policy and Tax Reforms Committee highlighted measures including VAT neutrality, unchanged import duty exemptions on aircraft and parts, and the ability for airlines to offset VAT credits against other taxes. The 7.5% VAT on tickets is expected to have minimal impact under the new system.
President Bola Tinubu confirmed implementation will proceed as planned, despite concerns from some airline executives, including Air Peace CEO Allen Onyema, about potential fare increases. The committee insists the reforms will ease financial pressures and support sustainable growth in the aviation sector. Visit www.jocomms.com for more news.