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Senate Wants Zero Customs Duty, VAT for Aviation Sector

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Aviation Sector

By Modupe Gbadeyanka

The federal government has been advised to consider exempting the aviation industry from the payment of customs duty and value added tax (VAT).

These exemptions would be for the importation of commercial aircraft and spare parts, according to the Senate, which debated the huge challenges facing the sector at the moment.

In March 2020, the federal government shut down the nation’s airspace as a result of the COVID-19 pandemic and operations were only allowed to resume six months after.

Even after the resumption, most airlines are struggling to operate at full capacity because of the various policies put in place to curb the spread of the virus. Some of them have asked for a bailout.

At the plenary on Tuesday, a member of the upper chamber of the parliament, Mr Adamu Aliero, moved a motion to look at the issues raised by operators in the industry.

He argued that the issues of multiple taxations, payment of import duty and commercial taxes raised by airline owners in Nigeria were genuine, calling on his colleagues to implore the federal government to take actions that would save the sector.

In his contribution, Mr Smart Adeyemi, threw his weight behind the motion, emphasising that “other countries gave bailout fund to their aviation sector” because the industry is key to the development of the economy.

“If airline operators say they can’t clear their goods because of VAT, then the government needs to look into that. The federal government should allow the aviation sector to be tax-free for at least three years,” the former president of the Nigeria Union of Journalists (NUJ), submitted.

At the end of deliberations, the federal government was asked to upgrade decaying infrastructures at the nation’s airports and fast-tracking the clearance of Aircraft-on-Ground (AOG), spare parts and facilitate the availability of jet air.

The government was also advised to fully implement the Executive Order on Zero Customs Duty and VAT on importation of commercial aircraft and aircraft spare parts and also implement the Executive Order of the removal of VAT and then eliminate multiple taxes, fees and charges on airlines.

The Senate also asked the Central Bank of Nigeria (CBN) to make foreign exchange readily and easily accessible for the sector and make interest rate a single digit for airlines which will reduce the cost of capital;

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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Travel/Tourism

CopterJet to Position Nigeria’s Aviation Sector as Global Powerhouse

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CopterJet

By Dipo Olowookere

If all things go well as planned, Nigeria’s aviation sector will soon become a global powerhouse with the entry of CopterJet, a specialist service firm, into the aviation value chain.

Last Thursday, the company launched its operations in Nigeria at an event held at the Murtala Mohammed International Airport (MMIA), Ikeja, Lagos, with several important persons in the sector in attendance.

The Chief Executive Officer of Copterjet International, Captain Toluwa Olorunyomi, the organisation has put in place strategies aimed to shoot the nation’s aviation industry to the top.

However, he called for strategic collaboration with stakeholders because the country has the number and strength to propel the aviation industry to the fore of global competitiveness with innovative solutions.

“At Copterjet, our vision is premised on a resolute mandate to transform the aviation industry in Nigeria and beyond.

“We have drawn a detailed roadmap with back-end strategy geared towards driving major initiatives that would herald a new era of opportunities to position Nigeria’s aviation industry as a global powerhouse.

“Our coming marks the beginning of a new dawn and also a historic event in the aviation industry,” the respected stakeholder in the sector disclosed at the unveiling ceremony.

Mr Olorunyomi, who said CopterJet was fully prepared to step into the aviation industry from the top end of the market, stated that with the right initiatives, support and collaboration with key players, the Nigerian aviation industry would drive economic prosperity and sustainability.

He emphasised that the impact of the COVID-19 pandemic on the global aviation ecosystem and its fallout on the tourism and hospitality businesses created an opportunity for stakeholders, including his company, to identify strategies and innovative solutions that would change the narratives in the business space, especially with the right partnership.

“I call on captains of industry to rise to the occasion and make Nigeria the hub of aviation in Africa. We have the number, we have the strength and so it is high time we leveraged on our strengths. We must be as competitive as possible in the industry given the necessary support,” he said.

On his part, the president of the National Association of Aircraft Pilots and Engineers (NAAPE), Mr Abednego Galadima, lauded Copterjet for its commitment to taking aviation to an enviable height, noting that the company’s services would not only help airline operators but also other aviation stakeholders.

“Copterjet will provide solutions to aircraft and equipment leasing where there has been a huge gap for years. With greater cooperation in the industry, Nigeria will experience newness and that will spur a new impetus in the industry. They have come and are here for the good of all,” Mr Galadima stated.

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Travel/Tourism

Back-Catering: NLC Threatens Action Against Foreign Airlines

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Nigerian Labour Congress NLC

By Adedapo Adesanya

The Nigeria Labour Congress (NLC) has alleged that some foreign airlines engage in back-catering, a situation where they bring in food from their countries instead of from Nigeria.

This claim was made by the Chairman of the Lagos State Chapter, Mrs Funmi Sessi in Lagos. She pointed out that Egypt Air, Ethiopian Airlines and Rwanda Air were the culpable operators involved in the alleged act.

Mrs Sessi said that preventing local suppliers from providing catering services for the airlines had reduced employment opportunities for the Nigerian populace.

“As part of building the economy and trying to boost the aviation sector following the COVID-19 pandemic, labour through NLC Lagos has discovered that foreign airlines are now in the habit of back-catering,” she said.

The NLC chairman said that some of the companies certified by the federal government to provide catering services had already retrenched some of their workers and lost percentages of their turnovers.

She listed the companies to include Newrest ASL Nigeria; Pan African Catering Services; Servair Nigeria, and LSG Sky Chefs.

“Servair Nigeria has over 200 workers; Newrest ASL over 600 workers, both in Lagos and Abuja; Servair Nigeria has already retrenched about 80 workers since the COVID-19 pandemic.

“Also, Newrest ASL has retrenched 122 workers, because these airlines are not patronising them.

“Newrest ASL has lost 58 per cent of its turnover, while Servair Nigeria lost 66 per cent,” the labour union leader said.

She then read out that labour would be forced to take decisive action if the practice does not stop.

She urged stakeholders in the aviation sector, including the government, to intervene and urgently address the issue.

“Other countries do not allow this practice, so why should ours be different; this means there will be job losses for the workers,” she said.

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Travel/Tourism

FG Considers Aerotropolis at Nigerian Airports

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Aerotropolis

By Adedapo Adesanya

The federal government has conceived the idea of building an aerotropolis in the country’s airports which will showcase Nigeria’s rich cultural heritage and tourism potential while boosting businesses and investment.

This was made when the convener of the EnjoyNigeria Expo 2021, Mr Isa Yusuf Sago, paid a visit to the ministry of aviation to seek collaboration ahead of the exposition.

The Minister, Mr Hadi Sirika, said the ministry had introduced and collaborated on many programmes to showcase Nigeria’s rich cultural and tourism heritage and potential.

Mr Sirika, represented by Mr Shehu Mohammad, who pledged his cooperation and support to the success of the event, said one of the programmes introduced was aerotropolis, which means “eco-city.”

Explaining further about the concept of aerotropolis, he said: “If you go India, Singapore, Dubai, or Qatar, their airports are surrounded with international hotels, recreational centres, tourism industry.

“This is what we want to establish in the international airports in Abuja, Lagos, Port-Harcourt and Kano.”

On his part, the convener, EnjoyNigeria Expo 2021, Mr Sago, said the trade and cultural exhibition being organised by the Federal Ministry of Industry, Trade and Investment (FMITI) is designed to benefit the nation’s Micro, Small and Medium Enterprises (MSMEs) sub-sector.

He said the international exhibition would go a long way to showcase Nigerian products and entry to the world.

He explained that MSMEs operators and entrepreneurs in the country have not been given enough platform to showcase their products both locally and internationally, hence there was an urgent need to bridge the existing gap.

As part of efforts to boost the activities of MSMEs operators and Entrepreneurs, he said, they would be trained on best business practices as well as get support and networking from other big-time business operators and investors during the Expo.

“We are here to help businesses to grow. Ours is a calling to help Nigeria.

“We had identified these gaps and we must close them for the benefit of our people and Nigeria.”

He underscored the need to promote Nigeria’s creative, entertainment, cultural and tourism industries, adding that these sectors of the economy are multi-billion dollar industries that should be explored for employment creation and revenue generation.

Speaking further, the convener pointed out that food, fashion, music, creative, art and culture, creative performance and tourism sector would feature during the week-long event that starts on December 6-12, 2021, in Abuja.

He, therefore, called on the government to create an enabling environment for SMEs to thrive, adding that government needs to look inward and empower the SMEs operators and entrepreneurs in the country.

Mr Sago further revealed that already the Federal Ministries of Women Affairs and Social Development, Information and Culture; Youth and Sports have thrown their weight behind the Expo.

Therefore, he sought support and collaboration with the Ministry of Aviation in the facilitation of the movement of prospective investors during the programme.

Also speaking, the Director of Investment in the Federal Ministry of Industry, Trade and Investment, Mrs Funke Ajayi, said the forthcoming Expo would help to unite Nigeria, as many SMEs operators and Entrepreneurs from across the length and breadth of the country would participate actively and network among themselves during the expo.

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