The Federal Government has announced the end of Value Added Tax (VAT) and duty exemptions for airlines, reinstating taxes on commercial aircraft engines, spare parts, and flight tickets. The new policy will take effect on January 1, 2026.
The disclosure was made during a business webinar on Thursday jointly organised by Aviation & Allied Business in collaboration with the Federal Inland Revenue Service (FIRS), themed “Nigeria Tax Act (2025) & The Aviation Industry: Aviation Sector Enlightenment Initiative.”
Speaking at the event, Nkechi Umegakwe, Assistant Director at the Nigeria Revenue Service (formerly FIRS), said the directive is backed by the newly passed Tax Reforms Act and stressed that its implementation would be comprehensive.
She explained that unlike the current regime where airline operators enjoy VAT and duty waivers on the importation of aircraft, engines, spare parts, and air tickets, these exemptions will no longer apply. From January 2026, it will become mandatory for airlines and other aviation service providers to pay VAT on all services and operations.
For years, Nigeria’s aviation sector has benefited from special tax exemptions aimed at supporting growth and reducing operational costs. The reversal, however, signals a shift toward increased revenue mobilisation by the Federal Government.
Industry stakeholders are expected to review the potential impact on ticket pricing, operational costs, and overall competitiveness of Nigerian carriers ahead of the implementation deadline.
