The Senate on Tuesday urged the Federal Government to fully implement the Executive Order on zero customs duty and zero Value Added Tax (VAT) on importation of commercial aircraft and aircraft spare parts.
This is even as it advised the Central Bank of Nigeria (CBN) to make foreign exchange easily accessible for investors in the aviation sector as well as make interest rate on lending at a single digit for airlines so as to reduce the cost of capital.
The Upper Chamber of the National Assembly 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 the air transport sector by fast tracking the clearance of Aircraft On Ground (AOG) spare parts.
These were the key resolutions of the Senate following its consideration of a motion sponsored by Sen. Adamu Aliero on ‘The Need to Protect Nigerian Indigenous Airlines From Extinction’
The sponsor of the motion in his presentation expressed serious concern that despite the significant contributions of the Airline Operators of Nigeria (AON) to the growth and development of the economy, indigenous airlines were still contending with multiplicity of challenges, including multiple taxes, that are threatening their operations and survival.
According to the lawmaker, the non-implementation of the executive order on zero customs duty and zero VAT on importation of commercial aircrafts and aircraft spare parts; high cost of capital and lack of single digit interest rate for airlines; replacement of NCAA five percent Ticket Sales Charge (TSC) among others, are pertinent issues that continues to plague Nigeria’s aviation industry.
Also, the Upper Chamber also directed 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.