High taxation on the aviation sector is discouraging air travel in Africa, with travelers deterred by the high cost of air tickets.
Aviation experts and lobbying groups are calling for government intervention, citing the crippling effect of high taxes on ticket sales and purchasing power. These concerns were raised during a gathering of continental air transport authorities and lobbying groups in Addis Ababa.
The high tax rates on air tickets could stifle the growth of air travel in the region, according to the groups.
Heads of the continental initiative introduced by the African Union and planned to give African airlines full liberalization in their flights within African destinations, the Single African Air Transport Market (SAATM), are among the critics of high airfares.
In his addressing speech at a gathering of continental air transport stakeholders in Addis Ababa last Wednesday, May 10, 2023, SAATM ambassador to the eastern region, Gilbert Kibe (Capt.) said governments aren’t well aware of the benefits of SAATM, therefore resisting its full implementation.
Through open sky policy being implemented, Gilbert believes the cost of ticket will reduce significantly as one of the main aims of SAATM is to reduce taxes, fees and charges that are levied on ticket prices in Africa.
“In many cases, these taxes and costs are over 65 percent of the price of a ticket. So if we were to reduce the taxes drastically and eliminate some of them that aren’t required, we will be able to see the reality of USD a hundred or two hundred ticket being issued,” he said.
Gilbert further called for a coordinated effort in convincing the governments, particularly ministers of finance, to reduce taxes and gain more revenue because of the volume of travel. More travelers on air and increasing tourism as a result of that is achievable by putting the cost down, he explained.
“There are countries in the Eastern Africa region where their people want to visit the neighboring countries but they have never been able to afford it because it is too expensive, and it is too far to go by road,” Gilbert said.
Out of 55 countries in Africa, 36 of them have signed for the implementation of SAATM but the countries are blamed for slow action in fully implementing it.
Dubbed Acceleration of SAATM, Ethiopian Stakeholders Roadshow, the event had seen presence of several stakeholders including Alemu Sime (PhD) Minister of Transport and Logistics, Ethiopian Airlines board chairperson and chief executive officer, Girma Wake and Mesfin Tassew, respectively.
In his address, the transport minister listed challenges he described are “grappling” in the aviation sector. Among them are weak aviation infrastructures, high ticket prices and lack of liberalization, which can all be avoided through integrated efforts of the African states.
Among the attendants was also Adefunke Adeyemi, who is the Secretary General of the African Civil Aviation Commission (AFCAC), one of the agencies under the African Union. She told The Reporter that airfares in Africa are over 50 percent more expensive than anywhere in the world.
“Expensive airfares make it difficult for people, and right now only 10 percent of the population are flying. If we make it more affordable, we will have more people buying tickets,” she said. “We have got to bring the cost down so that we can make aviation more accessible to more Africans.”
Adefunke also called for a united effort of stakeholders to “encourage the governments to see the opportunity to reduce taxes” as a means of increasing traffic. “It means that there is more volume and they would get more revenue at the end,” she said.
In its information page of the website that reads the conditions, Ethiopian Airlines cautions that the price of ticket includes taxes and fees imposed by the government authorities on the air transportation. The airline’s conditions read that “these taxes and fees, which may represent a significant portion of the cost of air travel” are included in the airfares.