Nigerian Travel Trade Seeks Tax Relief Amid Rising Fare Costs and Thin Margins
A senior figure within Nigeria's organised travel trade has called for a fairer approach to taxation, arguing that current assessment methods fail to reflect the financial realities faced by businesses in the sector. The concerns were raised ahead of a significant milestone for the industry, as the National Association of Nigeria Travel Agencies prepares to mark its fiftieth anniversary with celebrations in Lagos.
Speaking at a press briefing, Mr. Daisi Olotu, a member of the association's Board of Trustees and Managing Director of Dees Travels and Tours, explained that the high cost of international air tickets is creating a misleading picture of the revenues generated by travel businesses. Routes such as Lagos to London carry substantial fares, and when these transactions pass through agency accounts, the resulting turnover figures appear impressive on paper. However, the vast majority of that money belongs to the airlines, with only a small fraction, if any, retained by the agency as commission.
This disconnect between apparent turnover and actual earnings has become a pressing issue, particularly when tax authorities base their assessments on gross transaction values. Agencies find themselves liable for taxes calculated on amounts that never represented genuine income, placing considerable strain on businesses already operating within narrow profit margins.
The situation is further complicated by the various taxes and charges embedded within ticket prices. According to Mr. Olotu, these levies can account for as much as half of the total fare paid by passengers. Yet when calculating tax obligations, the full transaction amount is often considered, leaving agencies to shoulder a burden that does not correspond to their actual financial position.
For travel professionals across Africa, this issue resonates strongly. Many operators on the continent work within similarly challenging environments, where high costs, currency fluctuations, and tight margins leave little room for additional financial pressures. The call from Nigeria's travel trade for a more equitable tax framework reflects a broader concern shared by industry participants in numerous markets.
Beyond the taxation debate, Mr. Olotu used the occasion to highlight the irreplaceable value that professional travel services bring to consumers. He recounted a recent incident involving Nigerian travellers who found themselves stranded in the Middle East following the outbreak of geopolitical tensions in the region. Those who had purchased tickets directly from airlines struggled to obtain assistance and faced considerable uncertainty about their return home.
In contrast, passengers who turned to a professional travel service provider were able to secure alternative arrangements swiftly, enabling them to return to Nigeria without prolonged disruption. Such experiences, Mr. Olotu noted, demonstrate why knowledgeable and well-connected travel professionals remain essential, particularly in times of crisis when flexibility and rapid problem-solving are required.
He expressed confidence that positive experiences of this nature help build public appreciation for the industry. Satisfied travellers often become advocates, recommending professional services to friends, family, and colleagues. This organic endorsement strengthens the sector's reputation and reinforces the case for choosing expert guidance over self-service booking platforms.
Looking ahead, Mr. Olotu reaffirmed the association's commitment to raising professional standards and improving service delivery across the Nigerian travel trade. As the organisation celebrates five decades of representing the interests of its members, there is a renewed focus on ensuring that businesses within the sector are equipped to meet the evolving expectations of modern travellers.
He also acknowledged the role of the media in shaping how the public perceives the travel industry, encouraging journalists to continue providing balanced and constructive coverage that supports the sector's development.
For the African travel trade more broadly, the issues raised in Lagos serve as a reminder that advocacy remains essential. As governments across the continent seek new revenue sources, ensuring that taxation policies are fair and accurately reflect business realities will be a continuing priority for industry associations and their members.
