NCAA Blames Market Forces, High Demand for December Flight Fare Surge
- The NCAA said December’s high airfares were driven by demand, not taxes
- The authority dismissed claims that airlines pay up to 18 different taxes
- NCAA said there was no increase in taxes or jet fuel prices during the period
Oluwatobi Odeyinka is a business editor at Legit.ng, covering energy, the money market, technology and macroeconomic trends in Nigeria.
The Nigeria Civil Aviation Authority (NCAA) has explained why there was a hike in flight tickets during the Yuletide season.
Contrary to assumptions that government taxes or charges led to the hike, the NCAA argued the sharp increase in domestic airfares recorded during the December festive period was driven by market forces and high passenger demand.
Source: Getty Images
The clarification was made by the Director of Public Affairs and Consumer Protection at the NCAA, Mr Michael Achimugu, in a post shared on his official X handle on Sunday.
He dismissed claims by some airline operators that excessive taxes were responsible for the high ticket prices experienced during the Yuletide season.
According to Achimugu, assertions that domestic airlines pay as many as 18 different taxes are inaccurate and misleading.
He said the authority has repeatedly engaged airline operators on the issue, noting that the airlines themselves have admitted they do not pay the volume of taxes often cited publicly.
Airlines not paying taxes as high as claimed – NCAA
He added that discussions held with airline operators confirmed that the figures being circulated do not reflect reality.
He explained that while the NCAA does not regulate airfares, it closely monitors industry practices.
Based on consultations with airlines, travel agents and relevant departments within the authority, there was no evidence linking the December fare surge to increased taxes, BusinessDay reported.
Achimugu questioned why ticket prices rose to as high as N500,000 for flights lasting less than an hour when there had been no increase in either government taxes or aviation fuel prices during the period.
“If high taxes were responsible for fares of N150,000 to N200,000, why did tickets rise to N500,000 for a 45-minute flight when those taxes did not change?” he asked.
NCAA slams operators for always blaming govt
He also expressed concern over what he described as a recurring tendency to blame the government, despite recent policy reforms aimed at supporting domestic airlines.
According to him, the current administration has introduced measures such as access to dry-leased aircraft, a long-standing demand by local operators.
Achimugu said the fare increases were concentrated on high-traffic routes and described the trend as seasonal, noting that similar price hikes occur annually during festive periods.
He added that rising costs during December are not limited to aviation, as transport fares, accommodation and food prices also typically increase.
The NCAA’s comments come amid remarks by the Chief Executive Officer of Air Peace, Mr Allen Onyema, who recently said Nigerians pay some of the cheapest domestic airfares globally.
Onyema claimed that airlines retain only a fraction of ticket prices after taxes and charges, placing operators under financial pressure.
Source: Getty Images
Airlines say new tax could lead to hike in airfares
Legit.ng earlier reported that airlines have noted that the new tax law could further lead to an increase in flight fares and cost of airline operations.
This has made airline operators to call for urgent government intervention to prevent sector collapse and limit fare increases
The operators said the new tax framework could push economy-class fares to a new high, impacting passengers and the economy significantly.
Source: Legit.ng
