Domestic carriers have expressed dissatisfaction over the Nigeria Customs Service’s (NCS) refusal to implement the federal government’s policy which exempted commercial airlines from paying tariffs on aircraft and spares, as a way to help them recover from the economic impact of the coronavirus pandemic.
Last year President Muhammadu Buhari signed executive order authorising the waivers that could save airlines over N60 billion per annum, but the NCS have refused to implement the policy.
The Chief Operating Officer of Dana Air, Obi Mbanuzuo, who confirmed this, said despite the new policy, which was celebrated by airlines, Customs collects tariffs from the airlines whenever they import aircraft, engines and other spares.
“The Customs issue is a funny one. Government supposedly waived duties on aircraft and spare parts but each time we receive a consignment we are still charged duties.
“When we protest, the Customs in Lagos will say, ‘that’s Abuja’s problem’. That we should go and solve our problem in Abuja since it was the same Customs headquarters in Abuja that waived the duties that also gave them targets to meet.
“So we are stuck and still paying till tomorrow. When you have a $2,000 part keeping an aircraft on ground with angry passengers and lost revenue for days, it is easier just to pay the duty and get on with things than continue arguing with Customs officers that feel they are gods,” Mbanuzuo said.
It was learnt that airlines pay huge tariffs on imported aircraft and spare parts. This, according to an operator continues to eat into the airlines’ profits.
The airlines pay between 10 to 35 per cent of the cost of the spares to Customs. For example, if an airline buys aircraft spare part for $4 million it would pay minimum of 10 per cent duties, which is $4,000, about N1, 800,000.
Former Chief Executive Officer of Aero Contractors, Captain Ado Sanusi, said that the problem is that the federal government would have very good intentions to improve the aviation industry, but when it comes to implementation, the agency that has the responsibility to implement the policy would be foot dragging.
He said instead of executing government’s policy on waivers on tariffs for airlines, Customs would be prevaricating and when you report the agency to higher authority the officials would deny such.
“Either they pretend that they do not know about it or they would accuse the airlines of not meeting one requirement or the other, just to cover up.
“They keep the old policies and use them to milk the airlines and encourage corruption.
“The waiver policy is good because it will enable the airlines to survive and that will be good for the country. So if there is any requirement Customs needs, it should make it very clear to the airlines,” Sanusi said.
He said what the Customs was doing was counterproductive to the federal government, adding that when government introduced the policy, every stakeholder in the aviation industry was elated and they commended the federal government because it reinvigorated the hope of survival for the airlines.
“This is a policy that will assist airlines to recover from Covid-19 devastation. But instead of implementing this policy, Customs will soon accuse the airlines of not meeting certain criteria. They will insist that they did not get any directive from government to effect the policy if the airlines mention it,” Sanusi said.
Also, recently the House of Representatives condemned the continued collection of import duties on imported aircraft parts despite President Buhari ‘s executive order granting waiver on them.
The chairman, House Committee on Aviation, Nnolim Nnaji, had frowned on the continued imposition of Value Added Tax (VAT) on imported aircrafts and parts by the Federal Inland Revenue Service (FIRS).