Removal of air fares VAT: FIRS to take decision on implementation soon

The Federal Inalnd Revenue Service said, it was aware of the removal of Value Added Tax (VAT) from air fares in Nigeria saying implementation will be soon.

FIRS’s Director of Communications and Liaison Department, Abdullahi Ahmad, while responding to inquiries by CAPITAL POST on Tuesday in Abuja said, the management of the agency are meeting on Wednesday to consider the development among other vital issues.

He was however, uncategorical as to when the implementation would begin, but said the management will decide.

“The FIRS management are meeting tomorrow (Wednesday) to decide on when the implementation will start, but I can’t tell you categorically now”, he said.

Meanwhile, Airlines operators are set to
reduce fares in response to the removal of 7.5 per cent Value Added Tax (VAT). The suspension of VAT from air fares took effect from January 1, 2021, as part of incentives contained in the Finance Act 2020.

Operators of Airlines in Nigeria have revealed that the Federal Government has communicated VAT removal to them officially, saying they are awaiting FIRS’s implementation to enable them begin low air fares regime.

CAPITAL POST reports that there was skyrocketed domestic air fares last year that triggered public out cry all over the country.

The air liners attributed the high rate of airfares to cost of maintenance, VAT of 7.5%, COVID-19 pandemic and other contingencies which also resulted to downsizing some of their operational staff.

Meanwhile, the removal of VAT might result to reduction of air fares for domestic flight from N90,000 for a one-way trip on some routes, to as low as N27,500.