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N15bn debt by local airlines’ forced NCAA to introduce automated remittances

More indications have emerged on the sudden introduction of automated remittance system by the Nigerian Civil Aviation Authority (NCAA) for all local airlines.

Investigations by Business Hilights showed that the need to introduce the system of payment is to ensure prompt payment of fees as and when due by airlines to the federal agency.

The agency said local airlines’ indebtedness to service and regulatory establishments in the industry has hit N15 billion thus necessitating a speedy implementation of its directive on automation of remittance of the 5 per cent Ticket and Cargo Sales (TCS) charges paid to the agency.

Henceforth, NCAA has put it on the mandatory list for airlines to deduct 5 per cent of the air fares they collect from passengers for payment to the NCAA via automated system to limit chances of debt pile up.

The fund according to the Act establishing NCAA is shared among regulatory and service providers including the Nigerian Meteorological Agency, Nigerian Airspace Management Agency, Accident and Investigation Bureau (AIB) and the NCAA.

Business Hilights recalls that last year, NCAA had alleged that airline owners had appropriated monies it was supposed to collect on behalf of the agencies, noting that they were owing about N6 billion from the 5 per cent TCS charges.

However, after some levels of complains by association of Airlines Operators of Nigeria (AON), the image maker of NCAA, Mr. Sam Adurogboye, in a statement, said “there was no ambiguity with regard to the components of the billing of the charges, as Part 18.12.4. of the Nigeria Civil Aviation Regulations (Nig.CARs 2015) clearly provides that the 5 per cent air ticket sales charge shall be based on the total cost of travel fare paid by passengers to the airline”.

“This shall be the cost of ticket inclusive of fuel surcharge or any other charge added to the total cost of travel by the airline exclusive of government value added tax or any other tax that may be imposed by government from time to time,” Adurogboye said.

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