‘Nigeria’s air passenger taxes among world’s highest’

Damaging to tourism, business and labour mobility

NIGERIA’S Air passenger taxes are among the highest in the world, according to a new study by international accountancy network, UHY.

According to the report, Nigeria imposes a levy of US$20 on both short and long haul flights and long haul flights leaving the country through airport tax, though below the global average of US$23 on a short haul flight and US$53 on a long haul flight, which excludes many countries that do not tax flying at all.

UHY explained that these additional costs damage tourism, penalise SMEs trying to expand overseas, hamper remote regional cities and chip away at labour mobility. Although taxes on flying are often billed as ‘green taxes’, it noted that globally, it is exceptionally rare for the revenue they raise to be ring-fenced for environmental protection projects.

Taking a comparative study of passenger charges on an economy class flight by 21 governments around the world,
UHY said that the most expensive taxes are for long haul flights departing from a Russian airport, where unlike many other countries, airline tickets are subject to sales taxes. The highest taxes of any G7 economy are in the United States, which imposes US$23 worth of taxes on a short haul.

Within the EU, it observed that the United Kingdom still has the highest flight taxes with an adult holder of economy short haul ticket flying from a UK airport paying US$20 in tax. For a first or business class ticket, the tax paid goes for as high as US$41.

Many smaller European countries, the report, however, noted do not impose any taxes on individual passengers, including Ireland, Slovakia and Belgium. In many cases, there has been intense lobbying by local airports and business groups to keep taxes on flying to a minimum to prevent travellers using airports in neighbouring countries with lower taxes.

According to a Tax Partner with UHY Maaji & Co and member of UHY, Anthony Uwadiae, “airlines provide a crucial piece of infrastructure. They facilitate a great deal of economic activity that is essential for countries that want to benefit from globalisation. The higher taxes on flying in Nigeria hurt airlines, business users and consumers.