FG to grant debt discounts and review taxes to prevent airline shutdown

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Keypoints

• The Federal Government will grant domestic airlines “generous discounts” on debts owed to aviation agencies to avert a total shutdown of the sector.
• The decision follows a high-level meeting in Abuja on Wednesday, April 22, 2026, after Airline Operators of Nigeria (AON) threatened to suspend flights over a 300% surge in Jet A1 fuel prices.
• President Bola Tinubu will personally determine the percentage of the debt write-off for arrears owed to FAAN, NAMA, and the NCAA.
• A special committee has been approved to review and potentially reduce multiple taxes, levies, and charges on domestic flight tickets.
• Jet A1 prices reportedly surged from ₦900 per liter in February to over ₦3,300 per liter by April 2026, driven by global tensions involving Iran.

Main Story

Nigeria’s domestic aviation industry has received a critical lifeline as the Federal Government moves to prevent a nationwide grounding of flights.

Minister of Aviation and Aerospace Development, Festus Keyamo, announced on Wednesday that President Bola Tinubu has approved “generous discounts” on the massive debts domestic carriers owe to the Federal Airports Authority of Nigeria (FAAN), the Nigerian Airspace Management Agency (NAMA), and the Nigerian Civil Aviation Authority (NCAA).

The intervention was triggered by an emergency warning from the Airline Operators of Nigeria (AON), who had initially planned to suspend all operations on April 20, 2026.

The operators cited an “unsustainable” 300% spike in the price of aviation fuel (Jet A1), which jumped to ₦3,300 per liter in just two months. To further ease the financial “bleeding,” the President also directed the establishment of a committee to review the multiple taxes and levies that currently inflate the cost of domestic air tickets for passengers.

The Issues

The primary challenge is the fuel-price volatility gap; while the government offers debt relief, the underlying cause of the crisis—global oil price spikes linked to Middle Eastern tensions—remains outside domestic control. Authorities must solve the problem of regulatory-revenue friction, as granting deep discounts on debts to FAAN and NAMA could impact the agencies’ ability to maintain airport infrastructure and safety equipment. Furthermore, there is a financing-accessibility risk

; AON Chairman Allen Onyema noted that without lower-interest loans from the Bank of Industry (BOI), debt waivers alone may not be enough to ensure long-term solvency. To succeed, the upcoming meeting with oil marketers on Thursday must achieve a “pricing compromise” that makes Jet A1 affordable without destroying the margins of energy suppliers.

What’s Being Said

• “Mr. President mandated us to quickly bring a request to him… a generous discount on the debts the airlines are owing the aviation agencies,” stated Festus Keyamo.
• Air Peace CEO Allen Onyema described the 300% fuel price hike as “abnormal” and called for a total waiver of debts rather than just a discount.

What’s Next

• Domestic airlines are expected to submit their formal debt-relief requests to the Presidency by Thursday morning, April 23, 2026.
• A critical meeting between the Ministry of Petroleum Resources and oil marketers is scheduled for today to negotiate a downward review of Jet A1 prices.
• The newly approved tax-review committee is anticipated to begin auditing the current charges on domestic tickets to recommend immediate reductions.
• Airline operators have temporarily suspended their strike threat, but the continuation of flights remains conditional on the outcome of this week’s negotiations.

Bottom Line

By offering debt discounts and tax reviews, the Tinubu administration is attempting to subsidize the aviation sector’s survival without a direct cash bailout. ^{However, the ultimate success of this intervention depends on whether the government can also find a way to stabilize the “abnormal” cost of aviation fuel.}