By Louis Ibah
The Nigerian Civil Aviation Authority (NCAA), says local airlines’ indebtedness to service and regulatory establishments in the industry has hit N15 billion thus necessitating a speedy implementation of its directive on automation of remittance of the 5 per cent Ticket and Cargo Sales (TCS) charges paid to the agency.
The Nigerian Civil Aviation Act makes it mandatory for airlines to deduct 5 per cent of the air fares they collect from passengers for payment to the NCAA. The money is then shared among regulatory and service providers including the Nigerian Meteorological Agency, Nigerian Airspace Management Agency, Accident and Investigation Bureau (AIB) and the NCAA.
In 2016, the NCAA had alleged that airline owners had appropriated monies it was supposed to collect on behalf of the agencies, noting that they were owing about N6 billion from the 5 per cent TCS charges.
To facilitate easy and timely collection of the 5 per cent revenue, the Federal Government had granted the NCAA the permission to introduce the Aviation Revenue Automation Projects (ARAP) as an alternate means of manual remittances of revenues by the airlines.
But airline owners on Monday rejected the automation project describing its components as ambiguous, as it epitomises a form of double taxation, discriminatory as foreign airlines are exempted from it, They also said it was capable of rendering more local airlines bankrupt. The airline owners therefore called for the suspension of the automation project. However, Spokesman for NCAA, Mr. Sam Adurogboye, in a statement yesterday, however, said “there was no ambiguity with regard to the components of the billing of the charges, as Part 18.12.4. of the Nigeria Civil Aviation Regulations (Nig.CARs 2015) clearly provides that “the 5 per cent air ticket sales charge shall be based on the total cost of travel fare paid by passengers to the airline.
This shall be the cost of ticket inclusive of fuel surcharge or any other charge added to the total cost of travel by the airline exclusive of government value added tax or any other tax that may be imposed by government from time to time.”
Adurogboye said the NCAA would not rescind its decision to implement the automation policy, saying, “any airline that fails to comply will be viewed seriously by NCAA. All airline operators should be guided by Part 18.12.5 of the NCAR Act, which says, “all domestic and international airlines operating in Nigeria shall forward to the authority through an electronic platform provided by the authority, all relevant documents such as flown coupons, passenger or cargo manifests, air waybills, load sheets, clients’ service invoices and other documents necessary for accurate billing are submitted within 48 hours after each flight.”
He explained that the NCAA was getting remittances appropriately from foreign airlines which, he explained, were all hooked up to the International Air Transport Association/Billing Settlement Plan (IATA/BSP).
“Foreign airlines have complied fully by remitting their collections through the IATA/BSP. However, the domestic airlines have not joined the IATA/BSP. Therefore, ARAP is an alternate means of compliance to smooth remittance provided by the NCAA in line with Federal Government’s directive.
“Airline operators need to be aware that the NCAA is looking into all the issues raised in their letter. The NCAA therefore wishes to advise the Airline Operators of Nigeria (AON) to ensure adequate compliance with the automation and remit their collection as appropriate,” the statement added.