The Chairman and Chief Govt Officer of Air Peace, Allen Onyema, has warned that home financial system airfares might climb above N1 million from subsequent 12 months.
He made this recognized throughout an interview on The Morning Present on Come up Information on Sunday, linking the doable hike to the upcoming implementation of the brand new tax reform legal guidelines set to take impact from January 2026.
Based on him, the legal guidelines take away a number of tax exemptions beforehand granted to airways below the 2020 Finance Act, which had helped scale back working prices.
Onyema mentioned the removing of those incentives would sharply improve the price of operations, forcing airways to move the burden onto passengers.
Onyema defined that the brand new tax reform reintroduces Worth Added Tax (VAT) on plane, spare components, and air tickets, which have been beforehand exempted below the 2020 Finance Act.
He famous that, as an example, airways importing plane valued at round $80 million would pay 7.5% VAT, including billions of naira to prices.
He added that Nigerian airways already function in a high-cost setting, with borrowing charges of as much as 35%, making it unimaginable to soak up the added bills. Onyema additionally cited the Worldwide Civil Aviation Group (ICAO) annex, which states that VAT shouldn’t be charged on air transportation providers.
He warned that if the regulation is applied in 2026, economy-class fares might rise considerably.
“By the point you convey this stuff in, on the finish of the day, the price of operation might be enormous… your ticket fares will hit N1. one thing million quickly,” Onyema mentioned.
He additional pressured: “If we implement that tax reform, Nigerian airways might go down inside three months.”
He clarified that the rise displays operational prices, not profiteering, and argued that aviation must be supported to make sure connectivity and {economic} progress.
Past the upcoming tax reforms, Onyema highlighted persistent challenges going through Nigerian airways, together with excessive gas prices, international trade constraints, and a number of statutory fees.
He defined that for a home ticket costing round N350,000, solely about N81,000 truly goes to the airline, with the remaining consumed by taxes, levies, and different fees.
Onyema pushed again towards claims that airways overcharge passengers, stressing that Nigerian home fares stay among the many least expensive globally when transformed to {dollars}. He additionally famous that a number of home routes—notably to the Southeast—are barely worthwhile, as plane typically return with few passengers.
He addressed criticism over flight delays and cancellations, mentioning that many disruptions are attributable to elements outdoors airways’ management, equivalent to chicken strikes, restricted airport infrastructure, and errors by floor dealing with corporations.
Onyema warned that with out supportive insurance policies and reforms, the sustainability of Nigeria’s aviation sector might be at critical danger within the coming years.
For years, Nigerian airways have complained in regards to the heavy burden of taxes, levies, and fees that eat into their income. Earlier in December 2025, a further $11.5 safety levy below the Advance Passenger Info System (APIS) took impact, elevating the whole cost on worldwide tickets to $31.50.
From 2026, the aviation sector and passengers might be watching carefully to see how ECOWAS’ reforms match into Nigeria’s system and whether or not they ease airways’ excessive operational prices.
