Govt Officials Spend N300b Annually on Aircraft Charter
Vice President Namadi Sambo
By Chinedu Eze
“It has been revealed that top government officials at the Federal and state levels, including Ministers, President’s aides, governors, Senate and House committees, Speakers of State Houses of Assembly and others expend over N300 billion annually on aircraft charter.
A confirmed insider told THISDAY on Monday that charter operations in Nigeria is a multibillion Naira business that effectively competes with that of scheduled commercial operation and involves largely foreign registered aircraft with foreign registered crew, although most of the aircraft are owned by Nigerians.
With average of about $6,500.00 (N1, 01400) for one hour charter, the charter operators rake in huge amounts of revenue every month from mainly government officials and some Nigerian businessmen and women.
It was also revealed that although this subsector of air operation in Nigeria generates billions of Naira annually, many of them do not pay the stipulated charges, Value Added Tax (VAT) and corporate tax to the Nigeria Civil Aviation Authority and government.
THISDAY learnt that according to regulations, before an aircraft is allowed to operate commercial charter in Nigeria, it must be under an airline that has Audit Maintenance Organisation Certificate (AMO) and Air Operators Certificate (AOC).
AMO would ensure that the airline has the competence to maintain the aircraft it is flying, while the AOC would ensure that the aircraft is competently managed, but indications show that most of the aircraft that operate as charter in the country were acquired as privately owned and therefore do not pay the necessary charges, VAT and corporate tax to government.
For the aircraft to operate charter services in the country it must be deregistered of its foreign number and then be registered in Nigeria and the cockpit crew must hold valid Nigeria licence, and the aircraft must be under a commercial operator, but many of these aircraft owners do not abide by these conditions.
A source said that if these aircraft are managed by an airline that meets the aforementioned conditions, “the commercial operator ensures that tax, VAT and other charges are paid when they are due. Currently government is losing so much money on VAT, corporate tax and 5 per cent charge to NCAA, which are lost from those privately owned aircraft that are used for commercial charter services.”
But the spokesman of the Nigeria Civil Aviation Authority (NCAA), Sam Adurogboye, told THISDAY on Wednesday that all aircraft operating in Nigeria meet the conditions set out by the regulatory body, adding that “every airline has a licence that specifies its type of operations and are guided accordingly.”
He also said that private operators pay appropriate navigational charges like landing, parking etc. and that owners of private jets are not allowed to run commercial services, adding that doing so would be regarded as an aberration if detected.
“Owner of private jets are required to put their jets under an AOC holder for management, i.e., maintenance, insurance and crew, and accordingly held responsible for any violation in the process of its operations.”
But the source also told THISDAY, “Nigerians will travel overseas, buy aircraft, register it overseas, bring it to Nigeria in the pretext that it is leased and use it to operate commercial services without paying anything to government.”
The source also adds, “Crew members must correspond with the country of registry; however, these aircraft were not financed by any foreign financial institutions, they were bought by Nigerians, so most of them ought to be registered in Nigeria.”
Depending on sitting capacity and aircraft type, an aircraft could be chartered for average of $6,500 for one hour in addition to waiting charge, which includes return flight.”