Nigeria: Experts Blame Airlines’ Unchecked Practices, Not Taxes, For High Airfares

The recent surge in domestic air ticket prices has continued to spark intense debate among lawmakers, industry operators, and air passengers. In December, one-way fares reportedly rose from about ₦150,000 to as high as ₦400,000, depending on the airline, raising concerns, particularly over the timing of the increases during the yuletide travel peak.

The issue took centre stage during a panel discussion on Creative Nigeria; a tourism and culture programme aired on Mainland 98.3FM and anchored by award-winning journalists Frank Meke and Bunmi Bade Adeniji. The programme brought together key stakeholders to examine the causes of rising airfares and the role of taxation in the aviation sector.

Speaking on the programme, Dr. Yinka Folami, President of the National Association of Nigerian Travel Agencies [NANTA], described much of the public discourse on domestic airfares as speculative. He stressed that NANTA’s views are grounded in professional training and empirical data on ticketing and airfare construction.

“I don’t think it was Allen Onyema who made the statement that triggered the tax debate. There are two issues here: whether government taxes are responsible for the seasonal fare hikes, and the answer is no. Government taxes did not change in December,” Folami said.

He explained that fare increases during peak seasons are standard global aviation practice, driven by market forces and heightened demand rather than changes in government taxation. According to him, a one-way Lagos–Abuja ticket that sold for ₦145,000–₦150,000 in June rose to about ₦255,000–₦300,000 in December, reflecting seasonal demand.

Dr. Folami also dismissed widespread claims of 18 different government taxes in the aviation sector, noting that NANTA, an association with over 50 years of industry experience, has never encountered such a tax structure.

Offering a contrasting view, Chinelo Agina Obogo of Daily Sun Newspaper challenged assertions that Nigerian domestic flights are among the cheapest globally. She argued that such claims lack credible data and urged government authorities to be more responsive to airlines’ concerns.

“When you compare airfares with minimum wage levels, Nigerians still pay some of the most expensive fares. Government should engage airlines directly and allow them to clearly itemise the tax areas affecting fares so a workable solution can be found,” she said.

From the policy perspective, Yusuf Babalola of Leadership Newspaper highlighted government efforts to address airline complaints, while acknowledging that the sector faces deep-rooted structural challenges.

“Nigerians are already overstretched and don’t want additional burdens. While airlines complain about taxes, government is also listening,” he noted.

Babalola cited two recent interventions: the Presidential Committee on Tax Reform’s decision to exempt airlines from the 10% withholding tax, with plans to agree on a more appropriate rate, and the Nigeria Customs Service’s withdrawal of the 4% Free on-Board [FOB] levy on imported aircraft and spare parts for commercial airlines.

However, he criticised what he described as insensitive fare increases during the Christmas season, urging airlines to better manage peak-period pricing.

“The flying public finds these sudden increases shocking and overwhelming. Airlines must look inward, especially during December,” he said.

Addressing the issue of multiple charges and levies, Segun Kioki of The Guardian Newspaper acknowledged that airlines’ complaints about multiple taxes are valid, though he could not confirm claims of as many as 18 different levies.

He outlined several charges borne by airlines and passengers, including aviation fuel surcharges, Passenger Service Charges [PSC], ₦5,000 at FAAN-managed airports and up to ₦10,000 at some private airports, landing and parking fees, as well as international terminal charges of $80 within West Africa and $100 for other routes. Other levies include the Common User Terminal Equipment [CUTE] charge of $1.40, a $20 security levy, and $11.50 for Nigeria Immigration Service data capture, bringing total security-related charges to $35.10 per ticket.

“Discrimination exists, but it is not limited to airlines alone; it reflects a broader Nigerian factor,” Kioki observed.

In his contribution, Dr. Lucky George, Public Relations and Tourism scholar and Publisher of African Travel Times, identified capacity constraints as the core challenge confronting the aviation sector.

“In a country of over 200 million people, affordable fares would stimulate two-way travel. Over 80 per cent of Nigerians still travel by road, even though many would prefer to fly at least once in their lifetime. High costs and certain marketing and operational practices by airlines discourage this,” he said.

In his remarks, veteran journalist and Chief Executive Officer of Cre8tive 9ja, Frank Meke, called on airlines to balance profitability with patriotism. He also pointed to poor infrastructure, particularly road networks and inland waterways, as factors increasing pressure on air travel.

“Even the Nigerian Civil Aviation Authority [NCAA] has regulatory powers to check excessive fare hikes. The question is: why are they not being applied?” he asked.

Closing the discussion, Dr. Folami restated NANTA’s position, emphasising professionalism and the need to move beyond personalities. He clarified that a typical domestic ticket contains about four identifiable charges, including Quick Turn [QT] fees paid to FAAN, engineer or regulatory levies to NCAA, the basic fare, and an emergency surcharge [YQ/YR].

He concluded that aviation taxation should be approached with balance and objectivity, noting that a well-structured regime would ultimately benefit airlines, passengers, and government alike.

A major source of public confusion in the debate on airfares is the YQ/YR charge, which many passengers mistakenly regard as a government tax. In aviation pricing, YQ/YR refers to airline-imposed surcharges, originally introduced to cushion fuel price volatility but now broadly applied by airlines to cover operational costs, market demand pressures, and revenue management strategies.

Unlike statutory charges such as Passenger Service Charge [PSC], security levies, or regulatory fees paid to agencies like FAAN and NCAA, YQ/YR is determined solely by the airline and goes directly to the carrier. Industry experts note that while government taxes remain largely fixed, YQ/YR fluctuates significantly, especially during peak travel periods such as Christmas and Easter, making it a key driver of seasonal fare increases rather than government taxation.

By African Travel Times Team