The Senate has called on the Federal Government to fully implement the Executive Order on zero customs duty and zero Value Added Tax (VAT) on the importation of commercial aircraft and aircraft spare parts.
It also directed the Central Bank of Nigeria (CBN) to make foreign exchange readily and easily accessible to operators and make the interest rate a single digit so as to reduce the cost of capital.
These followed a motion, “The Need to Protect Nigerian Indigenous Airlines From Extinction.” moved by Senator Adamu Aliero (APC – Kebbi Central) at the resumed plenary on Tuesday.
The upper chamber called on the Federal Government to eliminate multiple taxes, fees, and charges to reduce costs in the aviation sector.
It also mandated its Committee on Banking, Insurance and other Financial Institutions to facilitate review of the National Insurance Commission (NAICOM) Act to grant the externalization of insurance placements for domestic airlines.
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It also urged the Ministry of Aviation to allocate more entries and frequencies to domestic airlines on international routes, as well as create a business-friendly environment in the air transport sector by fast-tracking the clearance of Aircraft On Ground (AOG) spare parts.
Aliero, in his presentation, expressed worry that despite the significant contributions of the Airline Operators of Nigeria (AON) to the growth and development of the Nigerian economy, domestic airlines in the country were faced with multiple challenges that threatened their existence.
He stated that the government had refused to carry out the executive order on zero customs duty and zero VAT on importation of commercial aircraft and aircraft spare parts.
He listed the high cost of capital and lack of single-digit interest rate for airlines; replacement of NCAA five percent Ticket Sales Charge (TSC) among others, as issues hampering smooth operations in the aviation sector.
