Ncell, the largest mobile player in Nepal, disputed a capital gains tax bill levied by the country’s tax authority relating to its acquisition by Axiata Group, arguing the agency incorrectly calculated the amount.
The operator filed a petition with Nepal’s supreme court against the Large Taxpayers Office (LTPO), which last week ordered it to pay NPR39.06 billion ($348 million) by 22 April.
In a statement, Axiata said the LTPO had “not complied with the procedure as stated in the country’s Income Tax Act for making a tax assessment”, instead using the court’s recent order “to substitute the amount that the LTPO had previously assessed for TeliaSonera” and transferred it to Ncell.
Ncell claims the tax bill should be NPR38 billion, or 25 per cent of the capital gains from the 2016 acquisition, Nepalese newspaper Setopati reported. The operator previously deposited NRP23.6 billion in two instalments, claiming it should owe just an additional NRP14.4 billion.
LTPO determined the capital gains tax was NPR62.6 billion including interest, with Ncell required to pay the amount less its deposits.
Axiata added the LTPO failed to provide Ncell the opportunity to respond to the imposed tax liabiliy or the option to apply for administrative review of the sum.
The tax payment relates to an acquisition of Reynolds Holdings, which held an 80 per cent stake in Ncell, by Axiata Group subsidiary Axiata UK. Sunivera Capital holds the remaining 20 per cent direct local shareholding, as required by law.Subscribe to our daily newsletter Back