Business

Concerns Mount Over Airfare On Lagos-London Route

Published

3 years ago

December 2, 2022

Lagos travellers pay 439% more

•Why we charge different fares from Nigeria-London — BA

Passengers travelling from Lagos to London in the coming days might be forced to travel through Abuja to their destination.

This is coming on the heels of massive differential in airfares for passengers travelling to Heathrow Airport, London through Lagos and those going through Abuja.

Findings by Vanguard Aviation World show that passengers flying on one-way economy ticket through Abuja on British Airways, BA, pay $501 (about N222,093) while those travelling through Lagos on the same airline and ticket class pay as much as $2,700 (about N1,196,910)

Also, passengers travelling through Ethiopian Airline on one-way economy ticket through Abuja pay N700,000, while those going through Lagos on the same airline and ticket class pay as much as N2.8million.

The fare differentials, according to industry operators may not be unconnected to demand and supply differentials but also noted that the distance is almost same for the two routes.

Vanguard gathered that flights from London to Abuja take six hours, and 20 minutes, while flights to Lagos from London take six hours and 25 minutes.

Though Air France maintains same fares from both routes the amount is also high at $2,141 (about …) on similar ticket class for a one-way journey.

Passengers’ reactions
A traveller who spoke to Vanguard about the development lamented her amazement to the development.

According to her, “I was to travel to London next week. So in a bid to ensure i pay less, I open the booking portal of BA, I was in Abuja and I mistakenly clicked on Murtala Muhammed International Airport, MMIA, and i was taken to the price to my amazement, the price i saw there was $2,700 I was shocked.

“I had to check very well to see if i had punched something odd. I realised I inputted Lagos instead of Abuja. So I had to readjust and the price I finally saw was far lower. This was quite outrageous as it was not supposed to be so.”

Another traveller who spoke to Vanguard Aviation World, said: “Why will Ethiopian Airline, and Africa airline put their airfare to London this high? I was expecting their price to be lesser than others but I was wrong.

“Even the price in Lagos differs by a far margin. Why would it be so?

“The ministry responsible should look into it, as for me it can only be attributed to extortion.”

Why our airfares differ in Nigeria – BA

Speaking to Vanguard Aviation World on the situation, BA’s Spokesperson, Josephine Simmons, explained that airfares can differ due to availability, airport taxes and other factors.

She stated: “Prices differ by airport due to numerous factors including customer demand and fare charges – including airport taxes.

“Most customers book their flights in advance, benefiting from competitive fares.”

Other stakeholders comment
The development has created a series of reactions from both stakeholders and travellers across the country.

While some stakeholders attributed the development to the exploitation of Nigeria’s passengers, others stated that the less demand in Abuja was strengthened by the security challenges.

According to the Principal Partner, Avaero Capital, Sindy Foster, the development possibly might be due to more demand than supply in Lagos.

“If BA had more demand from Abuja price would probably be higher. Most people are not flying direct between Abuja and London. I expect demand for Abuja went down due to security issues.”

Flights tend to be lower if there is more supply against demand. It is good that prices have come down in Abuja. Will be interesting to work out why they are still high in Lagos. I suspect there is less demand for Abuja.

The chairman of United Nigeria Airline, Obiora Okonkwo, said: “Why do foreign airlines charge Nigeria so much?

“In the aviation industry, one-hour flight fuel consumption is the same, the only difference is maybe different landing charges in London or Ghana, the rest is the same.

“I can assure you that if Air Peace goes to London today, Nigerians will fly to London with an Economy ticket of N500,000. Today the price is about N2 million, why should we pay such if they are converting from N450 to $1?

“We owe Nigerians this explanation. However, whatever is going on, this is a wake-up call that the local operators have to be supported as they have all it takes to operate internationally.

“Emirates have over $5 billion in support from their government. When we ask for support, it is not free, we pay back. American Airlines have equity of over $60 billion and a debt profile of $70 billion and those debts all come from government support.

“If the local airlines are supported, we can have the capacity that cannot be threatened globally. The easiest flight to operate is a long haul. Short haul is even more difficult as it is stressful to both the aircraft and cabin crew.

“It is even easier to go to London, aviation is the same globally, you are audited by IOSA, IATA and that is, they prevented us and make us looks bad.

“They are also aware that our quality and regulatory standards are high. We get crews and captains coming to Nigeria and they fail our exams and we send them back.”

Foreign airlines frequency in Nigeria
It would be recalled that Nigeria, a destination of over 22 foreign carriers, manages Bilateral Air Services Agreements, BASA, with over 78 countries.

These airlines operate daily, and weekly in Nigeria.

Ethiopian and ASKY, Togolese airline also operated by Ethiopian Airline, together operate 54 frequencies weekly in Nigeria.

African World Airways (AWA) has 49 frequencies per week; British Airways and Virgin Atlantic operate 21 frequencies weekly into Nigeria; EgyptAir with 16; Air France 15; Saudi Arabian Airways 13; Emirates 11; Lufthansa 11; Air Cote d’Ivoire10; Qatar 9; South African Airways 7.

Others were Delta, Royal Air Maroc, RwandAir, Sudan Airways, and Turkish Airways, which enjoy seven frequencies without reciprocity from Nigerian airlines.

Also, Etihad has five frequencies; Fly Mid Africa has four; Middle East Airlines – has four and Air Italy formerly Meridiana has three weekly flights to the country.

Business

Naira Records Highest Depreciation Against US Dollar

Published

1 day ago

January 10, 2026

Editor

The Naira recorded the highest depreciation against the United States dollar at the official foreign exchange on Friday to end the week on a negative note.

Central Bank of Nigeria data showed that the Naira extended its dip on Friday to N1,423.17 against the dollar, down from N1,419.72 traded on Thursday.

This represents a N3.45 depreciation against the dollar on a day-to-day basis, the highest in the week under review and in 2026 so far.

Meanwhile, at the black market, the naira remained at N1,490 per dollar on Friday, the same rate recorded on Thursday.

In the other week, the Naira recorded three gains and two losses against the US dollar and other currencies.

The development comes amid the continued rise in the country’s external reserves, which hit $45.67 billion as of January 8, 2026.

Business

KPMG Flags Five Major ‘Errors’ In Nigerian Tax Laws

Published

2 days ago

January 9, 2026

Editor

Fresh apprehension has surfaced over Nigeria’s newly implemented tax framework after KPMG Nigeria highlighted what it described as “errors, inconsistencies, gaps, and omissions” in the new tax laws that took effect on January 1, 2026. The professional services firm in a recent statement cautioned that failure to address these issues could weaken the overall objectives of the tax reforms.

Nigeria’s tax overhaul is built around four major legislations: the Nigeinpieces of legislation:ria Tax Act (NTA), the Nigeria Tax Administration Act (NTAA), the Nigeria Revenue Service (NRS) Establishment Act, and the Joint Revenue Board (JRB) Establishment Act. The laws were signed by President Bola Ahmed Tinubu in June 2025 and formally commenced in 2026. However, the reforms have continued to attract controversy since they were first introduced in October 2024.

Despite the concerns, government officials have consistently described the reforms as essential to improving Nigeria’s low tax-to-GDP ratio and modernisingpieces of legislation:modernizing the country’s tax system in line with evolving economic conditions.

In a detailed review, KPMG outlined several areas of concern.

Capital gains, inflation modernizing inflation and market response

KPMG flagged Sections 39 and 40 of the Nigeria Tax Act, which require capital gains to be calculated as the difference between sale proceeds and the tax-written-down value of assets, without adjusting for inflation. According to the firm, this approach is problematic given Nigeria’s prolonged high-inflation environment.

Data from the National Bureau of Statistics shows that headline inflation has remained in double digits for eight consecutive years, averaging over 18 percent between 2022 and 2025. Over the same period, asset prices have been significantly influenced by currency depreciation and general price increases.

Market data also reflects investor sensitivity to tax policy changes. Although the NGX All-Share Index gained more than 50 percent over the year and market capitalisation inflation,capitalization approached N99.4 trillion, equities experienced sharp sell-offs in late 2025. In November alone, market value reportedly declined by about N6.5 trillion amid uncertainty surrounding the new capital gains tax regime.

KPMG warned that taxing nominal gains in such an environment could result in investors paying tax on inflation-driven increases rather than real economic gains. The firm recommended introducing a cost indexation mechanism to adjust asset values for inflation, noting that this would reduce distortions while still enabling the government to earn revenue from genuine capital appreciation.

Indirect transfers and foreign investment concerns

Attention was also drawn to Section 47 of the Nigeria Tax Act, which subjects gains from indirect transfers by non-residents to Nigerian tax where the transactions affect ownership of Nigerian companies or assets.

This provision comes at a time of subdued foreign investment. Figures from the United Nations Conference on Trade and Development indicate that foreign direct investment inflows into Nigeria remain below pre-2019 levels, reflecting ongoing investor caution.

While similar rules exist in other countries, KPMG noted that they are often supported by detailed guidance and clear thresholds. The firm advised Nigerian tax authorities to issue comprehensive administrative guidelines to clarify scope, thresholds,capitalizationthresholds, and reporting obligations inorder to reduce disputes and limit potential negative effects on foreign investment.

Foreign exchange deductions and business impact

Another issue identified relates to Section 24 of the Act, which restricts businesses from deducting foreign-currencyforeign currency expenses beyond their naira equivalent at the official Central Bank of Nigeria exchange rate.

In reality, limited access to official foreign exchange forces many companies to source FX at higher parallel market rates. Under the current rule, the additional cost becomes non-deductible, effectively increasing taxable profits and overall tax liabilities.

KPMG observed that although the provision aims to discourage FX speculation, it does not adequately reflect supply constraints. The firm recommended allowing deductions based on actual costs incurred, provided transactions are properly documented, to avoid penalisingforeign currencypenalizing businesses for factors outside their control.

VAT-related expense disallowances

Section 21(p) of the Nigeria Tax Act also came under scrutiny for disallowing deductions on expenses where VAT was not charged, even if the costs were entirely business-related.

Given Nigeria’s large informal sector and persistent VAT compliance gaps, analysts argue that the rule unfairly shifts part of the VAT enforcement burden onto compliant taxpayers. KPMG advised that the provision be removed or significantly amended, stressing that expense deductibility should be based on whether costs were wholly and necessarily incurred for business, while VAT compliance should be enforced directly on defaulting suppliers.

Non-resident taxation uncertainties

KPMG further highlighted ambiguities around the compliance obligations of non-resident companies. While the Nigeria Tax Act recognizespenalizingrecognizes withholding tax as the finalthe final tax for certain nonresident payments in the absence of a permanent establishment or significant economic presence, the Nigeria Tax Administration Act does not clearly exempt such entities from registration and filing requirements.

Nigeria’s network of double taxation treaties, including agreements with the UK, South Africa, Canada, and France, generally supports the principle that final withholding tax extinguishes further obligations. Experts warn that inconsistencies between the laws could create uncertainty and discourage foreign participation.

KPMG recommended harmonizing the relevant provisions of the NTA and NTAA, with explicit exemptions for non-resident companies whose tax obligations have been fully settled through withholding tax. The firm noted that such alignment would ease compliance and enhance Nigeria’s appeal for cross-border transactions.

As Nigeria undertakes its most extensive tax reform in decades, KPMG concluded that the success of the overhaul will depend on clarity, consistency, and alignment with international best practices. Without timely amendments, businesses may face higher costs, foreign investors could remain cautious, and capital markets may continue to experience volatility.

Recall that KPMG concerns come after a lawmaker, Abdulsamman Dasuki, raised alarm over alleged alterations to the gazetted tax laws.
(DAILY POST)

Business

Naira Records First Depreciation Against US Dollar In 2026

Published

2 days ago

January 9, 2026

Editor

The Naira recorded its first depreciation against the United States dollar in the official foreign exchange market on Thursday, the first time in 2026 so far.

The Central Bank of Nigeria’s data showed that it weakened on Thursday after days of gains to N 1,419.72 per dollar, down from N 1,418.26 on Wednesday.

This means that for the first time this year, the Naira dipped by N1.46 against the dollar on a day-to-day basis.

Similarly, the Naira also depreciated by N10 at the black market to N1,490 on Thursday, down from the N1,480 recorded the previous day.

This comes despite the continued rise in the country’s foreign reserves to $45.64 billion as of Wednesday, 7th January 2026.

DAILY POST reports that the Naira recorded a seven-day bullish run at the official foreign exchange before Thursday’s decline.