Passengers’ traffic: Anxiety as local airlines raise alarm over consistent decline

By Dickson Omobola

Consistent decline in domestic passenger traffic is creating anxiety among operators in the country’s air transport sector, with many warning that the recently signed Tax Reform Acts could worsen the situation by 2026.

This came on the heels of a disclosure by Acting Managing Director of Ibom Air, Mr George Uriesi, that domestic passenger traffic between January and July 2025 had dropped by 27 per cent, compared to the same period in 2024.

Given that domestic throughput in 2022 was 16,172,433, which dropped to 15,685,272 in 2023 and 11,549,443 in 2024, operators are worried that the harsh economy and the Tax Reform Acts, which would reintroduce the Value Add­ ed Tax, VAT, on ticket sales in 2026, could compound the situation.

On June 26, 2025, President Bola Tinubu signed four Tax Reform Bills into law, including the Nigeria Tax Act, NTA, The Nigeria Tax Administration Act, NTAA, Nigeria Revenue Service Act, NRSA, and the Joint Revenue Board Act, JRBA, to take effect on January 1, 2026.

In separate conversations with Vanguard, the operators, however, said reducing fares through promos and cutting down on the multiple taxes which affect the price of tickets were some of the methods through which the market could be stimulated.

Managing Director of Aero Contractors, Ado Sanusi, said: “Airlines, the aviation industry and the federal government can do something to reverse the situation (decline in passenger load).

‘’First is the general economy of the country that has slowed down. But I believe that with the recent increase in economic activities, business travel will increase.

“For leisure travel and tourism that are declining, it is because the price of tickets has made it a bit difficult for passengers to travel. When they see that it is not a must travel, they decide not to travel.

“But we need to see how we can organically stimulate the market within the space of aviation and the airlines’ ability. How can we do that? Reducing fares through promos. Most importantly, we need to look at the taxes.

“Aviation fuel is fixed, but the multiple taxes contribute a lot to ticket prices. With the recent Tax Reform Acts, which reintroduced VAT, which is 7.5 per cent on ticket sales, it means that from January 2026, there will be a 7.5 per cent increase on the tickets. This will also increase the price of tickets and reduce the number of passengers flying.”

On his part, a Trustee member of Airline Operators of Nigeria, AON, Roland Iyayi, fingered the state of the economy as a major reason for the persistent decline in passenger numbers.

He said: “If the economy is buoyant, there will be enough travel, mobility will increase and there will be traffic.

‘’Disposable income, which is also affected by the economy, has also reduced. Inflation has eaten deep into the disposable income of many. Air travel has become a victim of the high level of inflation which we currently have in the country.”

He, however, warned that if taxes were increased on air transportation due to the Tax Reform Acts, airlines would have no choice but to transmit it to customers.

He said: “Invariably, what that does is reduce the number of people who can travel. For every increase in tax, demand is suppressed.”

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