Nigeria loses over $10b annually to foreign registration of private jets

WorldStage Newsonline– The Federal Government of Nigeria has expressed displeasure over the rising number of private jets carrying foreign registration, which translated to over $10 billion annually loss in form of payment charges and taxes abroad.

The government said private jets being deployed for illegal charter services are ripping the country of huge revenue at the detriment of registered commercial charter operators covered under the general aviation regulations enunciated by the Nigeria Civil Aviation Authority ( NCAA).

It said these operators also abstain from paying import duties, five per cent VAT charges and also five per cent charges to the Nigeria Civil Aviation Authority (NCAA).

Sequel to such illegal operations by private jet owners, the NCAA has been mandated to slam a fine of $3,000 on every operation carried out by private jet on illegal services.

General Manager, corporate communications, NCAA, Mr Yakubu Dati explained that government was getting increasingly worried over such infractions by private jet owners, “which is not giving room for the growth of commercial charter operations which are registered by the NCAA for specialized services.”

He said that “out of 139 private jets operating in Nigeria, 87 are registered overseas while 52 are registered locally and further explained that when aircraft is registered overseas it is assumed that it is visiting Nigeria as it usually registered under a foreign operator and the implication of this is that it will not pay import duty when coming into Nigeria.”

Dati said it was time private jet owners desisted from such illegal operations to enable government harness huge revenue potentials from commercial charter jet operations that is fledging.

He said government will not hesitate to implement full sanctions on such operations by private jet owners, which is at variance with the new civil aviation regulation.

Dati disclosed that Nigerians who own foreign registered private jets siphon over $10 billion annually from the country to pay foreign cockpit crew, charges and taxes overseas.

He said the total amount of money that Nigeria loses to these operators is estimated to be over $15 billion annually, not including charges paid by aircraft used for charter services, which most of them illegally deploy the aircraft when in use in the country.

“The aircraft pilots and engineers must be foreigners whose licenses are registered in that country the aircraft is registered and this means that no Nigerian is operating any of these 87 aircraft as pilot; no Nigerian engineer can be employed to maintain the aircraft. Then every year the owner of the aircraft must pay charges to continue to maintain the aircraft under the foreign operator in which the aircraft was registered,” Dati also explained

Dati said that almost all the monies used to buy these aircraft were earned and generated in Nigeria, but they are now spent overseas and by registering the aircraft overseas the owner of these jets abstain from paying taxes to agencies of Nigerian government.

“It is also worthy of note that 80 percent of those aircraft registered overseas are also used for illegal charter operation and when used as charter they do not pay the five percent VAT tax and the five per cent charges to NCAA as they did not register as charter aircraft ab initio.”

Dati said that 80 percent of 87 foreign registered aircraft is 69 and the average cost of every charter is $7,000 per hour and conservatively every aircraft operates three hours charter per day and when multiplied with 69 aircraft it amounts to 207 hours per day.

“So these aircraft earn $1,449,000 million per day and the five percent VAT tax and five percent NCAA charges which they do not pay, if deducted from the above earning would amount to $144, 900 per day. In a year this would amount to $51, 584, 400 or N8. 2 billion and this is a fragment of the import duties which is estimated to be in billions of dollars which these aircraft owners did not pay before they were brought into the country,” Dati said.

Original article:  http://www.worldstagegroup.com