• VIDEOS
  • About
  • Contact
  • Despite Media
Ghana Election 2020
  • Home
  • Election 2020 Results
  • Local News
  • Politics
  • Showbiz
  • Sports
  • Business
  • Opinion
  • VIDEOS
  • Media
    • Videos
    • Audio
    • Photos
Local News
 
 
 
Home Business Business News 201604

High Taxes Threaten Aviation Industry

29-Apr-2016
/ Business News, Business
Email
Print
Comments 0
(0)
Comments
Share on Facebook Share on Twitter
 

The International Air Transport Association (IATA) has bemoaned the high taxes imposed on the domestic aviation sector in Ghana, saying the phenomenon militates against the growth of the industry.

According to the Vice President of IATA for Africa, Mr Raphael Kuuchi “taxes on jet fuel increase the cost burden of airlines who are already operating in a challenging environment and hinders the domestic growth of an industry that brings extensive socio-economic benefits.”

He said Ghana must not treat its aviation industry as an easy target for taxation if it is serious about becoming an aviation hub in the sub region, adding that the negative impact on the economy of taxing air transport outweighs the revenue raised.

Mr Kuuchi has therefore urged the Ghanaian government to recognize aviation as a socio-economic enabler and provide the appropriate infrastructure.

In an interview with this paper, Mr Kuuchi noted that the elimination of taxes on jet fuel would put Ghana in line with the common practice in Europe and countries around the world where aviation growth is strong.

“It will not only boost aviation in the country but create a new opportunity for Ghana to become a hub for aviation and fuel trade,” he stressed.

The IATA Vice President encouraged government to reduce taxes and charges on infrastructure in order to attract more capital inflow into the industry.

Ghana’s domestic aviation sector has been reeling under high operational costs, worsened by the high costs of jet fuel which has compelled some service providers to fuel their aircraft in neighbouring Nigeria.

The difficult terrain has seen the exit of three airlines, Antrak Air, Fly540 and CityLink leaving only two, Starbow and Africa World Airlines (AWA). 

The three have recently indicated their return to the industry but experts are wondering whether they can survive the odds.

The imposition of the 17.5 per cent Value Added Tax (VAT) by government in 2014 sent airfares through the roof. 

Fares on all routes jumped up by 40 per cent after the VAT took effect, resulting in a 30 per cent reduction in passenger patronage of flights.

Even though the government through the Ghana Airport Company (GACL) is investing in the expansion of airport infrastructure across the country, industry players say the pace is too slow. 

Chief Executive Officer (CEO) of Starbow, Mr James Eric Antwi lamented the alarming losses the airline has had to contend with in the wake of bad weather.

“ The weather became so bad that in December 2015 we operated only 25 per cent of our flights, in January this year we did 65 per cent and fell drastically again within the first week of February, “ he explained.

Mr Antwi blamed the Airline’s predicament on the absence of requisite infrastructure at the regional airports to assist visibility and navigation.

“These are challenges that have to do with infrastructure; we need to have proper navigational equipment on the ground to direct the aircraft to the airfield;” he said.

For an airline that flies five times a day into Kumasi, the impact of cessation of flights on operations and on passengers is tremendous.

“For both Starbow and AWA, we have had serious cash flow problems; Starbow aircraft is a leased one and whether we fly or not we have to pay for the lease and it’s quite costly; we have to pay salaries of staff,” Mr Antwi observed.

For many businessmen and women who travel by air especially to Kumasi, Sunyani and Takoradi the impact of the cessation of flights was quite heavy.

“We have mining and oil companies whose staff leave Accra every morning to Takoradi and return in the evening and so when we had to cancel our flights they all suffered with some of them turning to the roads,” the Starbow CEO recalled.

He hoped that government will through the Ghana Civil Aviation Authority (GCAA) provide the Instrument Landing System (ILS) in Kumasi, Tamale and Takoradi to aid operations.

IATA called on government to come up with the appropriate regulation to secure the industry for growth, pointing out that Ghana and other African nations have an opportunity to enact smarter regulations to enable better aviation connectivity. 

It said implementation of the Yamoussoukro Decision will open up air routes within the continent and provide opportunities for more than 5 million additional passengers a year. 

“Investors will only invest in an industry if they can see the potential for positive returns,” IATA added.

Source: The Finder

 

 
 

 

Comments ( 0 ): Post Your Comments >>

Disclaimer: Opinions expressed here are those of the writers and do not reflect those of Peacefmonline.com. Peacefmonline.com accepts no responsibility legal or otherwise for their accuracy of content. Please report any inappropriate content to us, and we will evaluate it as a matter of priority.
Featured Video
Previous Post

Packaging Of Ghanaian Products Need Improvement - Minister

Next Post

Busy Launches New Mobile App At Breakfast Meeting With Its Corporate Clients

 
 

More Stories

PWDS Small Business Owners To Receive Support Through Accelerator Program
Alan Kyeremanten Best Person For Trade Ministry As Afcfta Kicks Off – GUTA
We Can’t Use Our Buses To Convey Only 2 Passengers - GPRTU
Focus More On Agric Sector Investment To Improve Economy – Dr Sarkodie
Study: More Than Half Of German Firms Expect Skilled Labour Shortage
BoG To Arrest Cedi’s Depreciation With US$775m Injection
Fidelity Bank Ghana Relocates Two Branches; Merges Two Branches
MTN Ghana Awards Momo Agents and Merchants
FDA To Harmonize Importer TIN And Product Registration Numbers
Next Post

Busy Launches New Mobile App At Breakfast Meeting With Its Corporate Clients

  Ghana Business News

  • General News
  • Economy
  • Banking & Finance
  • Stock Market
  • Industry/Manufacturing


 
 

Other Business News Stories

  • PWDS Small Business Owners To Receive Support Through Accelerator Program

  • Alan Kyeremanten Best Person For Trade Ministry As Afcfta Kicks Off – GUTA

  • We Can’t Use Our Buses To Convey Only 2 Passengers - GPRTU

  • Focus More On Agric Sector Investment To Improve Economy – Dr Sarkodie

  • Study: More Than Half Of German Firms Expect Skilled Labour Shortage

  • BoG To Arrest Cedi’s Depreciation With US$775m Injection

  • Fidelity Bank Ghana Relocates Two Branches; Merges Two Branches

  • MTN Ghana Awards Momo Agents and Merchants

  • FDA To Harmonize Importer TIN And Product Registration Numbers

  • Standard Chartered Holds First Draw Of Season Of Surprises Campaign

 

 
 

Popular Videos

Election Petition: Maurice Ampaw’s Reaction

Asomdwee Park Being Reconstructed...All Thanks To Akufo Addo - Koku

I've Opened My Doors For A Serious Boyfriend - MzVee Reveals

I Was Insulted By NDC Members For “Comfortable Lead” Comment In 2016 – Koku Anyidoho Recalls

Provision Of PPEs: You Can Close Down Schools...But Leave Us Out - Private Schools To GES

See How Confused You Are!!! - Mireku Duker Jabs Mahama And His Legal Team

Peace FM Online and Despite Media

peacefmonline.com offers its reading audience with a comprehensive online source for up-to-the-minute news about politics, business, entertainment and other issues in Ghana

Follow us on social media:

Category

  • Home
  • Local News
  • Politics
  • Showbiz
  • Sports
  • Business
  • Opinion
  • Trivia
  • Foreign
  • Audio
  • Photos
  • Videos
  • Elections
Decision Time
Ghana Election 2020 2016 Elections
Services
Online Radio Audio on Demand Ghana Elections Advertise with Us
Useful Links
Despite Media About Us Contact Us Feedback Form Terms and Conditions Privacy
Our Brands
Despite Media UTV Peace FM Okay FM Hello FM Neat FM Peacefmonline
  • About
  • Advertise
  • Terms & Conditions
  • Contact
  • Privacy

© 2020 Peacefmonline.com - An online portal owned and managed by Despite Media

  • Home
  • Local News
  • Politics
  • Showbiz
  • Sports
  • Business
  • Articles
  • Trivia
  • Foreign
  • Photos
  • Videos
  • Audio
  • Election 2020

© 2020 Peacefmonline.com - An online portal owned and managed by Despite Media