Nigerian Civil Aviation Authority (NCAA) has berated domestic airlines over misinformation on the 5 percent Ticket Sales Charge (TSC), saying it was never a tax but a charge on passengers collected in trust by airlines to be remitted to government so as to ensure facilitation is not hindered at the airports.
The regulatory body has also expressed disappointment on what it called misconception that airlines are making everyone believe that taxes are only synonymous with the Nigerian business environment, stating that before most of these airlines started operations, the ‘so-called taxes’ were made known to them.
This development is coming few weeks after domestic airlines under the aegis of the Airline Operators of Nigeria (AON) came out to criticise in strong terms the charges in the industry, attributing the many failures of airline businesses to multiple taxation and other unfriendly taxes not found anywhere else in the world.
Speaking at a press briefing, Sam Adurogboye, general manager, public affairs, NCAA, sought to clear up some of the accusations against the regulatory body while stating that some of the airlines were just being economical with the truth, especially with the 5 percent.
Adurogboye said, “The business is highly capital-intensive. There is no operator that did not know about the charges before they commenced operations nothing new has been added. There is an emerging carrier that is growing today, he operates like a passenger and staff and they are growing.
“Five percent ticket sales charge is not paid to NCAA by the airlines as tax, it is a charge added to the passengers determined airfare. When passengers pay five percent how does it become a charge? The airlines brought up the idea that to enhance passengers’ facilitation at the airport, they will collect the 5 percent on our behalf, after which the monies will be remitted to us, which we all agreed to in 2001. The money is for the sustenance of the Civil Aviation Authority, (CAA).”
According to Adurogboye, for the NCAA to be autonomous in truth, according to the dictates of the Civil Aviation Act, it needed to source its funding autonomously and the 5 percent which used to be collected from passengers at the airport prior to 2001 was the way to ensure non-interference.
“We had to compare what obtains in Canada, United States, South Africa and other places, all CAA are meant to be autonomous and it cannot be autonomous if we are not financially autonomous. We exist because of the safety of passengers and the passengers pay for the CAA to run.
“The day they say government should start giving us money, then we become non-autonomous. The five percent ticket sales charge is in the act passed by national assembly. If not for the foreign airlines that pay as at when due, they (domestic airlines) would have grounded NCAA in Nigeria,’ he said.
On airlines going under, he said, “At the time NCAA started in January year 2000, we had about 150 airlines in our register. In 2006, they came down to 28, the rest went under. It was not because NCAA didn’t do their regulation well. At a point, the number reduced to 12 and today we have eight airlines. It is because we do what we need to do, that is why those who have to fissile out will naturally fissile out.
“There are airlines you get to know their source through corporate governance. It is not about the number of aircraft you have or whether it is brand new, it is whether you run your business the way it should be run. It is within the privy of the investor to get the right person to do the job and once it is done, you will prosper in it.”
IFEOMA OKEKE
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