$2bn tax case: MTN Nigeria to know fate next year

October 29, 2019

A Federal Judge has finally fixed January 30th and 31st of 2020 to hear the allegations by the federal government of Nigeria against telecom giant, MTN Nigeria Plc over $2bn in back taxes.

The leading telecoms company has continued to deny any wrongdoing, claiming innocence of the tax demand made last year by Nigeria’s Attorney General, Abubakar Malami.

Recall that in September 2018 that the office of Nigeria’s Attorney General demanded that MTN should pay up the accrued sum of $2 billion it owed in back taxes.

The demand came at a time when the company was still trying to finish up with another cash settlement imposed by the government over the company’s alleged fraudulent SIM registration practices.

Around the same time, the telco was ordered by the Central Bank of Nigeria to bring back the sum of $8.1 billion which it remitted to South Africa illegally.

On the tax demand, the Attorney-General said MTN’s $2 billion tax debt was uncovered when his office investigated companies’ tax compliance in Nigeria. According to him, taxes span over a ten-year period and are related to the importation of foreign equipment into the country as well as payments to the suppliers of the said equipment.

MTN maintained that the demand is uncalled for, claiming that it settled all its tax obligations. The company had even asserted “it is both regrettable and disconcerting” that it is facing these issues despite previous efforts made in the past to resolve them.

MTN had filed the suit by a writ, dated September 10, 2018, challenging the legality of the AGF’s assessment of its import duties, withholding tax and value added tax in the sums of $2 billion.

The Telecom giant among other reliefs, a declaration that the AGF’s demand of the sums of $2 billion from MTN, is premised on a process which is malicious, unreasonable and made on incorrect legal basis.

At the last adjourned date on February 7, the court had fixed Tuesday March 26 for hearing of the preliminary objection by the AGF, after parties informed the court of service of their various processes.

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