MTN Nigeria, the leading telecommunications company with a market share of 36.2% and 77.1 million subscriptions, has filed an appeal against a Tax Appeal Tribunal (TAT) ruling that upheld a principal liability of $47.8 million in unpaid taxes for the years 2007 to 2017. The appeal was announced by MTN's Secretary, Uto Ukpanah, who informed the Nigerian Exchange Limited and its investors about the decision on Tuesday.
The dispute originated in 2018 when the Attorney General demanded $2 billion in tax arrears from MTN. This claim was later withdrawn in January 2020 and reassigned to the Federal Inland Revenue Service (FIRS), which initially assessed MTN's tax liability at $93.6 million. This figure included both principal liability and penalties. However, it was later revised to a total of $135.7 million, incorporating the principal liability of $47.8 million and interest and penalties totaling $87.9 million.
In an effort to clarify VAT Act provisions regarding transactions such as offshore training services, software licensing, and upgrades, MTN Nigeria took their case to TAT. On October 20, 2023, TAT ruled in favor of upholding the principal liability but dismissed the interest and penalty charges of $87.9 million.
Following this ruling, MTN decided to appeal based on recommendations from its tax and legal consultants. Tobechukwu Okigbo, MTN's Chief Corporate Services and Sustainability Officer, emphasized the importance of adhering to established procedures in such disputes and advocated for fiscal policy reforms.
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