Nigeria loses $10m to foreign registered private jets

LAGOS — The federal government said,
yesterday, that Nigerian owners of foreign
registered private jets were taking out of
the country annually over $10 million
through payment of foreign cockpit crew,
charges and taxes overseas.
According to government, this has further
assisted to boost capital flight out of the
country.
Coordinating General Manager, Corporate
Communications of Aviation Agencies, Mr.
Yakubu Dati, who disclosed this in Lagos,
also revealed that owners of private jets
who use them to operate illegal charter
services were ripping off the country of
well-deserved revenue and destroying
legally registered commercial charter
operators who abide by the regulations of
Nigeria Civil Aviation Authority, NCAA.
He said it was to stop the exploitation of
the country and grow the business of
registered charter operators that the
regulatory agency slammed $3,000 on
every operation of private jet owners who
use their aircraft to carry out illegal
services.
He said operators of foreign registered
private jets also abstained from paying
import duties, five per cent VAT charges
and five per cent passenger service
charge, PSC, to the Nigeria Civil Aviation
Authority, NCAA, thus denying the country
of the needed revenue.
He said the total amount of money that
Nigeria loses to this category of operators
was in excess of $15 billion annually,
excluding charges paid by aircraft used
for charter services.
Dati said of the 139 private jets operating
in Nigeria, 87 were registered overseas,
while 52 were registered locally.
He explained that when aircraft was
registered overseas, it was assumed to be
visiting Nigeria as it usually registered
under a foreign operator, adding that the
implication of this was non-payment
import duty when coming into Nigeria.
“The aircraft pilots and engineers must be
foreigners whose licences 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
explained
He lamented that though much of the
money used to purchase the aircraft was
earned and generated in Nigeria, owner of
the jets abstain from paying taxes to the
Nigerian government, having registered
the jets oversea.
Dati said: “It is also worthy of note that
80 per cent of those aircraft registered
overseas are also used for illegal charter
operation and when used as charter, they
do not pay the five per cent VAT tax and
the five per cent passenger service
charge, PSC, to NCAA as they did not
register as charter aircraft ab initio.”
He estimated that 80 per cent of 87
foreign registered aircraft operating in the
country was 69, adding that at the
average cost of charter of $7,000 per
hour, the jets made $1.449 million daily
without paying taxes and PSCs.
“So these aircraft earn $1,449,000
million per day and the five per cent VAT
tax and five per cent 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
explained.