Nigeria: AON's 5% Ticket Sales Charge Challenge Legally Unfounded

• The Airlines Operators of Nigeria (AON) recently called for the abolition of the 5% Ticket Sales Charge and 5% Cargo Sales Charge.
• AON attributed their demand to rising operational costs, global economic downturns, and increased aviation fuel prices.
• However, these charges are legally mandated under Part V, Section 23(1) of the Nigeria Civil Aviation Act of 2022.
• The 5% charge applies to all international and domestic air transportation originating in Nigeria and is paid by the passenger on the total airfare, excluding other statutory fees.
• The regulatory framework for these charges was established through public discourse and adheres to International Civil Aviation Organisation (ICAO) standards, with AON having previously advocated for airlines to collect and remit them.

The Civil Aviation Act of 2022, specifically Part V, Section 23(1), unequivocally mandates a five percent airfare, contract, charter, and cargo sales charge payable to the authority.

The Airlines Operators of Nigeria (AON), spearheaded by Air Peace and United Nigeria Airlines, recently advocated for the abolition of the five percent Ticket Sales Charge (TSC) and five percent Cargo Sales Charge (CSC). This proposition was made during the 30th Annual Conference organized by the League of Airports and Aviation Correspondents on September 10, 2026. The conference, themed 'Towards a Sustainable Aviation Industry: Balancing Government Revenue Demands with Sector Growth,' served as a platform for the operators to voice their concerns.

The airlines' push for the abolition of these charges stems from a confluence of factors, including continually rising operational costs, a prevailing global economic downturn, and a significant liquidity squeeze. Specifically, the escalating cost of aviation fuel, attributed to the Iran-America war, has further exacerbated their financial challenges. Operators collectively described Nigeria as comparable to Afghanistan, citing it as the 'worst place to do business' due to what they termed a 'multiplicity of levies' surcharged on airlines.

From the perspective of the Airline Operators of Nigeria, there is no justifiable reason for the payment of the five percent Ticket Sales Charge and five percent Cargo Sales Charge. They contend that these levies effectively grant government agencies a five percent net ownership stake in the respective airlines, a position they find untenable given their current economic struggles.

Contrary to the assertions made by the Airline Operators of Nigeria, the five percent Ticket Sales Charge and five percent Cargo Sales Charge are not discretionary levies but are statutorily mandated. Legal experts and commentators emphasize that AON's stance on this matter is legally unfounded, urging them to consult and thoroughly study the Civil Aviation Act of 2022, as amended, which outlines the origin and procedures for these collections.

The Civil Aviation Act of 2022, specifically Part V, Section 23(1), unequivocally mandates a five percent airfare, contract, charter, and cargo sales charge payable to the authority. This charge is applicable to all international and domestic air transportation originating within Nigeria, irrespective of where the ticket is sold, issued, or the contract of carriage is executed. Furthermore, Section 23(2) clarifies that this five percent charge is levied on the total amount, explicitly excluding other statutory fees and taxes.

Subsection 23(2a) of the Act further specifies that this charge is to be paid by the passenger as part of the airfare. This clear legal framework underscores that the charges are a fundamental component of the regulatory financial structure, rather than an arbitrary imposition, and are designed to be borne by the end-user of air travel services.

The argument put forth by the Airline Operators of Nigeria, citing global economic conditions as a basis for abolishing the charges, is viewed by some as misdirected. It is highlighted that current global economic challenges are not unique to Nigeria; for instance, German Volkswagen recently announced 50,000 job cuts due to biting global economic conditions. While international airlines often receive financial assistance from their home countries during difficult periods, they typically do not advocate for the complete elimination of a civil aviation authority's primary funding source. Supporting Nigerian airlines is a valid government objective, but not at the expense of crippling another essential agency.

Moreover, the introduction of any act or regulation within Nigeria's aviation sector, or indeed in any other country, is subject to a rigorous process involving public discourse. This process adheres to what the International Civil Aviation Organisation (ICAO), a United Nations agency responsible for global aviation standards, terms 'Notice of Rule Making.' ICAO prescribes international Standards and Recommended Practices for its member states, ensuring thorough scrutiny before implementation.

It is important to note that the five percent Ticket Sales Charge and five percent Cargo Sales Charge underwent this comprehensive regulatory process. Historically, the Nigeria Civil Aviation Authority (NCAA) collected these charges directly. Interestingly, AON itself previously championed the collection of these charges by airlines on behalf of the NCAA, with subsequent remittance, citing challenges with the NCAA's direct collection methods. These charges represent a crucial funding mainstay for the Civil Aviation Authority, essential for its operations and regulatory oversight.

Lawyers advising Nigerian airlines or aviation businesses should note that the 5% Ticket Sales Charge and Cargo Sales Charge are statutorily mandated under the Civil Aviation Act of 2022. The article argues that the Airlines Operators of Nigeria's call for their abolition is legally unfounded, implying that compliance officers must continue to factor these charges into operational costs and financial planning, as legislative change is unlikely in the short term.

Source: Original reporting via aviation industry commentary.