MTN's Nigeria woes deepen with $2B tax bill - Mobile World Live

MTN’s Nigeria woes deepen with $2B tax bill

05 SEP 2018

The Nigerian government slapped a $2 billion tax bill on MTN relating to its activities over the past decade, as the company’s troubles in the country increased.

The tax demand comes a week after the Central Bank of Nigeria ordered the company, which is the country’s largest operator, to refund $8.1 billion which it said was repatriated illegally from the country. 

In a statement seen by Bloomberg, MTN reportedly refuted the claim for back taxes, as well as reiterating its innocence over last week’s allegations from the Central Bank.

The office of Nigeria’s attorney general ran an investigation and calculated that the company owes a sum of $2 billion, related to the import of foreign equipment and payments to suppliers over the past decade.

MTN however states it already settled tax charges for its activities over the past decade with a payment of $700 million.

A source close to Bloomberg said that the difference between the $700 million paid by MTN and the $2 billion figure is due to differing interpretations between both parties on certain charges.

Additional scrutiny on MTN, which is based in South Africa, comes as Nigerian President Muhammadu Buhari seeks a new four-year term, with an election approaching in February.

He has pledged to clamp down on tax avoidance from international companies as part of his campaign.

Past troubles
In 2016, MTN settled a dispute with Nigerian regulators, agreeing to pay a $1.7 billion fine for failing to register the personal details of 5.1 million subscribers.

Demands in the last week from Nigeria for MTN to pay $10.1 billion in charges and refunds also puts additional pressure on the company’s IPO plans in the country.

Despite outlining its aims to launch a listing in 2016, the company is yet to file a formal application with the country’s stock exchange.

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Kavit Majithia

Kavit joined Mobile World Live in May 2015 as Content Editor. He started his journalism career at the Press Association before joining Euromoney’s graduate scheme in April 2010. Read More >>

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