New tax reforms aim to ease burdens for Nigerian airlines
The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has stated that Nigeria’s new tax laws are intended to support the aviation industry. This comes after concerns raised by Allen Onyema, CEO of Air Peace, about the impact of the Nigeria Tax Act and related policies. Oyedele clarified that the reforms address long-standing tax issues and are not the source of airlines’ challenges. He emphasized that the new laws are designed to reduce costs and improve the sector’s financial health.
What we know
- Taiwo Oyedele explained that the removal of the 10% withholding tax on aircraft leases will provide major relief for airlines.
- The new laws make airlines fully VAT-neutral, allowing them to claim input VAT on assets and services, with refunds mandated within 30 days.
- Existing exemptions on import duties for commercial aircraft, engines, and spare parts remain unchanged.
- The reforms include a framework to reduce corporate income tax from 30% to 25% and harmonize several levies into a single Development levy.
- Multiple levies and charges on airlines are not a result of the new tax laws, and the government is working with operators to find lasting solutions.
