Airlines, NCAA clash over ₦20 billion ticket sales charge debt

A dispute between the Nigeria Civil Aviation Authority (NCAA) and domestic airlines over the remittance of statutory charges has exposed growing tensions within the aviation sector, with operators and regulators trading blame over an estimated ₦20 billion debt.

The controversy came to the fore after the NCAA issued a directive threatening to suspend services to 11 airlines over alleged non-remittance of the mandatory five per cent Ticket Sales Charge (TSC) and Cargo Sales Charge (CSC). Although the regulator later suspended the enforcement action, it maintained that the affected airlines remain indebted and must settle their obligations.

Among the airlines named in the dispute are Air Peace, Ibom Air, Arik Air, United Nigeria Airlines and ValueJet.

Speaking on the matter, NCAA Director of Public Affairs and Consumer Protection, Michael Achimugu, stressed that the charges are critical to the funding of key aviation agencies responsible for maintaining safety and operational efficiency across Nigeria’s airspace.

According to him, proceeds from the charges are shared among agencies including the Nigerian Airspace Management Agency (NAMA), the Nigerian Meteorological Agency (NiMet), the Nigerian College of Aviation Technology (NCAT), and the Nigerian Safety Investigation Bureau (NSIB).

The Airline Operators of Nigeria (AON), however, challenged the regulator’s position, arguing that the disputed funds do not represent unpaid service fees owed by airlines.

The association explained that airlines pay for regulatory services such as aircraft inspections, certification, and licence renewals in advance and on a cash-before-service basis. It maintained that the outstanding amounts relate solely to the statutory Ticket Sales Charge, which is collected from passengers as part of ticket purchases.

According to the operators, airlines merely act as collection agents for the government and should not bear the financial burden associated with collecting and remitting the levy.

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Industry stakeholders say the current arrangement imposes significant administrative and financial pressures on carriers already grappling with rising operating costs. They point to banking charges, payment processing fees, foreign exchange volatility, and soaring aviation fuel prices as factors worsening liquidity challenges across the sector.

The AON further argued that the deduction of the charge from gross ticket revenue affects airlines’ working capital at a time when profit margins remain slim and borrowing costs continue to rise.

To address the recurring disagreement, the association has called for amendments to the Civil Aviation Act, proposing that the NCAA establish a direct collection mechanism for the levy rather than relying on airlines as intermediaries.

The operators suggested that the model could mirror existing passenger service charge systems administered by the Federal Airports Authority of Nigeria (FAAN), where charges are collected directly at the point of ticket purchase.

The dispute comes despite recent efforts by the Federal Government to ease financial pressures on the aviation industry. President Bola Tinubu had approved a temporary 30 per cent concession on outstanding statutory obligations owed by airlines as part of broader support measures for the sector.

While acknowledging calls for reform, the NCAA insists that existing laws require airlines to collect and remit the charges promptly. The regulator maintains that any change to the collection framework must be backed by legislative amendments.

As both sides continue negotiations, industry observers warn that a prolonged standoff could affect regulatory confidence and operational stability in Nigeria’s aviation sector, underscoring the need for a lasting resolution to the revenue collection dispute.