The Federal Government is taking decisive steps to eliminate the burden of multiple taxation in Nigeria’s aviation sector, according to Festus Keyamo, Minister of Aviation and Aerospace Development. Speaking during an interview on Tuesday, the minister revealed that a dedicated committee has been established to address the long-standing issue, which has plagued operators and stifled competitiveness in the industry.
Keyamo emphasized that the initiative is part of a broader reform agenda championed by President Bola Tinubu, who he described as being “big on addressing the issue” of over-taxation. While acknowledging that the problem predates the current administration, he stressed that it remains a priority under his watch, although tax-specific policy matters fall under the jurisdiction of the Ministry of Finance.
Beyond taxation, the minister also identified capacity challenges among private operators as a key factor driving high airfare prices and poor service delivery. According to him, the scarcity of aircraft exacerbated by reliance on older, less efficient models is tied to a historic lack of international confidence in Nigeria’s judicial and aviation regulatory systems.
“In the past, the global leasing community didn’t trust Nigeria’s system,” Keyamo explained. “They were hesitant to bring in newer aircraft because they feared that if operators defaulted on lease terms, it would be difficult to repossess their equipment. This perception was based on past experiences.”
He pointed out that a vast majority 98 percent of aircraft operating in Nigeria are leased, not owned. This is not unique to Nigeria, he added, noting that leasing is standard practice even among the world’s largest airlines. However, access to modern aircraft requires a country to have a credible and investor-friendly legal and regulatory environment.
“The more confidence they have in your system, the better the quality of aircraft you can attract,” he said. “Countries with poor ratings tend to get older models. But this is changing.”
Nigeria Rises to Top of Africa’s Aircraft Leasing Rankings
Keyamo announced a significant achievement: Nigeria is now rated as the number one jurisdiction in Africa for aircraft leasing. He credited the improvement to reforms tied to Nigeria’s compliance with the Cape Town Convention, particularly the enforcement of the Irrevocable De-registration and Export Request Authorization (IDERA) framework a legal tool that simplifies aircraft repossession for lessors in the event of default.
“Before President Tinubu took office, Nigeria had a compliance rating of 49.5 percent. Since we implemented these reforms, we’ve improved that to 75.5 percent the highest in Africa,” he said.
This improved rating, recognized by the Aviation Working Group, now positions Nigeria as a preferred destination for aircraft leasing in the region. However, Keyamo noted that actual fleet upgrades may still take time due to a global shortage of aircraft, as manufacturers struggle to meet growing demand.
He expressed optimism about the emergence of Comac, China’s fast-rising aircraft manufacturer, as a potential disruptor to the duopoly of Boeing and Airbus. The arrival of new market players, he said, is expected to increase availability and lower costs for countries like Nigeria.
As the aviation sector undergoes transformation, Keyamo reaffirmed the government’s commitment to creating an environment that fosters private investment, lowers operational costs, and ultimately delivers better value to Nigerian air travelers.
