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“It is our prayer that President Muhammadu Buhari will go a step further to encourage the National Assembly to pass this Executive Order into law as quickly as possible,” the Airline Operators of Nigeria Chairman, Capt. Nogie Meggison, commented on the news in a statement.
“This is good news for the industry,” says also Adeshole Kayode, Director of Capstone Travels and Vice President of the National Association of Nigeria Travel Agencies (NANTA-Abuja Zone).
According to Kayode, Nigerian Travel Agents have complained of ‘double taxation’ for years but nobody ever took notice, until now. He explains airlines deduct WithHoldingTax (WHT) directly at the point of ticket sales. Despite the airlines already collecting taxes, the Tax Office requires Travel Agents to pay as well, resulting in double taxation for Travel Agents.
Says Kayode: “The VAT issue has lingered for years with nobody able to fathom exactly how these taxes are being calculated or who is exempted to pay. This issue has over the years generated a lot of controversies between the Tax Office and the Travel Agent.”
“This removal of VAT on transportation by the President through an Executive Order is a welcome development that calls for celebration. To me as NANTA executive, it’s a very welcome development. The good news also comes at the perfect time, as we are professionalising the industry.”
Also for domestic airline operators and travellers, the removal of VAT is good news, adds Kayode. He explains we are likely to see reduced airfares in the near future. He explains many Nigerians still view flying as reserved to the elite. More affordable flights will boost domestic travel, according to Kayode.