Sindy Foster: ECOWAS aviation tax rule threatens FAAN, NCAA operations without new funding model

Sindy Foster, principal managing partner at Avaero Capital Partners, says removing air ticket taxes and reducing service charges could expose Nigerian aviation agencies to “serious” operational and regulatory risks without an alternative funding model.

Foster was speaking on the decision by the Economic Community of West African States (ECOWAS) to prohibit air ticket taxes in a chat with TheCable on Wednesday, warning that without a new financing model, compliance would destabilise airport operations and safety oversight.

The ECOWAS first announced the plan in November 2024, aiming to reduce airfares at all airports across the subregion.

The policy, slated for implementation from January 2026, is backed by a Supplementary Act, a regulatory framework that seeks to harmonise regional aviation charges, taxes, and fees in line with international standards set by the International Civil Aviation Organization (ICAO).

Under the framework, ECOWAS aims to “eliminate all taxes” and “reduce” passengers and security charges by 25 percent.

‘THE POLICY CONTAINS FUNDAMENTAL CONTRADICTION’

Commenting on the development, Foster said the intention behind the new ECOWAS aviation charges framework is to reduce the cost of air travel in West Africa and harmonise a system that has long been fragmented.

However, she faulted the proposed rules, saying the policy “contains fundamental contradictions”.

“On one hand, Member States are instructed to align charges strictly with ICAO’s cost-recovery principles, meaning fees should only reflect the actual cost of providing aviation services,” Foster said.

“On the other hand, the same document mandates a blanket 25 per cent reduction in passenger and security charges, regardless of whether those charges are already below cost. A cost-based framework and a politically fixed reduction cannot logically coexist.”

Speaking on the policy’s impact on Nigeria, the aviation expert said the challenge is more acute for the West African giant.

She said while Nigeria does not always label its levies in the same way as other ECOWAS countries, “it certainly imposes the equivalent taxes and per-passenger charges that ECOWAS is now seeking to abolish or reduce”.

The levies, according to the aviation analyst, include international passenger fees, development surcharges and “even seasonal visitor-related charges such as those applied during the ‘Detty December’ period”.

The levies are economically identical to the categories ECOWAS has targeted, the Avaero executive said.

‘REMOVING CHARGES WITHOUT ALTERNATIVE FUNDING WOULD CREATE OPERATIONAL RISKS’

“These revenues are not discretionary. FAAN, NCAA, NAMA, NSIB and NiMET rely almost entirely on these passenger charges to fund airport operations, security screening, navigation services and safety oversight,” Foster said.

“Removing or reducing these charges without an alternative funding model would create serious operational and regulatory risks.

“Unlike some Member States, Nigeria does not have a budget-funded aviation system; it has a predominantly IGR-funded system, and these charges are the backbone of that structure.

“There is also the unresolved tension with the earlier Banjul Accord decision supporting a regional $1 aviation security levy. One regional framework asks countries to introduce a security contribution, while the new ECOWAS framework asks them to abolish or reduce similar levies.

“Nigeria and other states will have to navigate these conflicting obligations while maintaining ICAO compliance.”

Foster admitted that the ECOWAS is right to push for a more competitive regional cost base,  she said implementation “will require more than a blanket percentage reduction”.

“Without a realistic transition plan and a new financing model, Nigeria cannot comply fully without destabilising its aviation ecosystem,” the expert added.

“The region wants cheaper travel, but nations must still fund the systems that make aviation safe and functional. Striking that balance is the real challenge ahead.”

Addressing the issue of multiple taxes and fees spotlighted by the ECOWAS as a barrier for airlines, Keyamo said tax policy lies beyond his ministry’s remit.

However, the minister acknowledged receiving regional advice urging relief for operators.

He noted that the concerns have been formally communicated to fiscal authorities, and reaffirmed the government’s commitment to supporting the aviation sector while safeguarding funding for essential infrastructure.

Announced after the council of ministers’ meeting in Abuja on December 10, the ECOWAS air transport tax rule comes amid complaints of high airfares in Nigeria.

Earlier on Thursday, the house of representatives asked the federal government to cut aviation taxes by 50 percent to make flights more affordable for Nigerians during the yuletide.