Why we collect ticket sales charge, by NCAA 

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NIGERIAN Civil Aviation Authority (NCAA) has berated domestic airlines over what it described as misinformation about the five per cent Ticket Sales Charge (TSC).

Its spokesman, Sam Adurogboye, said the tax was a charge on passengers collected in trust by the airlines for remittance to the government to ensure facilitation at the airports.

Adurogboye said the regulatory body also frowned at what he called airlines ploy to make people believe that taxes are only synonymous with the business environment. He said what many domestic carriers regard as multiple charges were already in existence before they  started operations.

”The business is highly capital-intensive. There is no operator that did not know about the charges before they commenced operations; nothing new has been added. Five per cent ticket sales charge is not paid to NCAA by the airlines as tax, it is a charge added to the passengers determined airfare. When passengers pay five percent how does it become a charge?” he asked rhetorically.

Adurogboye said the airlines brought up the idea that to enhance passengers’ facilitation at the airport, they will collect the five percent on behalf of NCAA, after which the money will be remitted to the authority. The agreement, he said, was reached in 2001.

He said the money from the remittances forms part of financial  sustenance of the NCAA. Adurogboye further explained that for the regulator to be autonomous, it needs to source its funding autonomously.

“We had to compare what obtains in Canada, United States, South Africa and other places, all CAA are meant to be autonomous and it cannot be autonomous if we are not financially autonomous. We exist because of the safety of passengers and the passengers pay for the CAA to run. The day they say government should start giving us money, then we become non-autonomous. The five percent ticket sales charge is in the act passed by National Assembly. If not for the foreign airlines that pay as and when due, they( domestic airlines) would have grounded NCAA in Nigeria’’.

On the accusation of multiple taxes by the agency and how they are crippling airlines’ business,  the  NCAA spokesman said that there is no country where charges were not present and that even some of those charges were not charged in Nigeria.

‘’There is no country where there are no charges, whether landing, parking, overflying, amongst others. There are some charges that we are not charging in Nigeria, such as hotel, task, tourism development.”

He attributed the dwindling number of airlines in the country to a lack of  corporate governance and that the NCAA was carrying out its responsibility that was why the numbers kept going down.At the time NCAA started in January year 2000, we had about 150 airlines in our register. In 2006, they came down to 28, the rest went under. It was not because NCAA didn’t do their regulation well? At a point, the number reduced to 12 and today we have eight airlines. It is because we do what we need to do that is why those who have to fissle out will naturally fissle out.”

”There are airlines you get to know their source through corporate governance. It is not about the number of aircraft you have or whether it is brand new, it is whether you run your business the way it should be run. It is within the purview of the investor to get the right person to do the job and once it is done, you will prosper in it. There are airlines that are running domestic operations that we send commendation letters to for doing the right thing. There are airlines that pay their bills as and  when due. There are still those who do the right things. You run airlines using the right equipment for the right operations. You need to prepare and invest on the route, you need to know yourself and what you have passion for. You also need to know the problem you want to solve. You go into business because you want to solve a problem and because you have passion for it. “

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