ga('send', 'pageview');

Nigeria Orders MTN to Pay $2b Tax Days After $8.1b Refund Request

By Dipo Olowookere

Africa’s leading telecommunications company, MTN Group, has been asked to pay the sum of $2 billion to the Nigerian government.

According Reuters, this is for the importation of foreign equipment and payments to foreign suppliers over the last 10 years by MTN which began operations in the Africa’s largest market in 2001 alongside Econet Wireless, which now operates under the name Airtel in Nigeria.

Business Post reports that last week, the Nigerian authorities, through the Central Bank of Nigeria (CBN), ordered MTN Nigeria to return $8.1 billion it allegedly moved out of the country illegally to its parent country, South Africa, which slipped into recession today.

ALSO READ  BREAKING: NSE Suspends Trading of Conoil Shares

This is not the first time MTN is having issues with the Nigerian government.

In 2015, the Nigerian Communications Commission (NCC), ordered MTN Nigeria to pay a fine of $5.2 billion for failing to disconnect phone lines of unregistered subscribers on its network.

The fine was later reduced to $1 billion after negotiations between both parties with the promise that MTN must list its shares on the Nigerian Stock Exchange (NSE).

According to the report by Reuters on Tuesday, MTN had been in talks with Nigeria’s Attorney General and Minister of Justice, Mr Abubakar Malami, about an investigation into tax compliance in a statement outlining the background to the case of the money sent out of the country.

ALSO READ  Saraki Pledges to Review Energy Law

“In this process, his (the Attorney General’s) office made a high-level calculation that MTN Nigeria should have paid approximately $2 billion in taxes relating to the importation of foreign equipment and payments to foreign suppliers over the last 10 years,” MTN said.

“MTN Nigeria will continue to engage with the relevant authorities on all these matters, and we remain resolute that MTN Nigeria has not committed any offences and will vigorously defend its position,” the company further said.

However, Mr Malami has declined to comment on the issue, referring Reuters to a spokeswoman at the Ministry of Justice, who could not immediately be reached by phone.

ALSO READ  Naira Appreciates Against Pound at Parallel Market

Shares in MTN dropped 5.6 percent to 81.95 rand as of 1250 GMT, bringing losses since last Thursday, when the central bank issued the $8.1 billion demand, to nearly 25 percent.

Business Post reports that on Monday, shares of MTN began trading on the floor of the Ghana Stock Exchange (GSE) after an initial public offering (IPO) from May 29, 2018 to July 31, 2018.

The offer received 33 percent subscriptions from both retail and institutional investors, who were both Ghanaians and non-Ghanaians.

Related Articles

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

more recommended stories

%d bloggers like this: