- Nigerian telecom giant MTN has refuted claims of owing ₦900 million in taxes to the Osun State government.
- The Osun State government, through its consultant, Global Transactions Nigeria Limited (GTNL), had accused MTN Nigeria of installing over 270 kilometres of fibre cables without paying the appropriate statutory taxes.
- However, the telco denied the debt allegations, insisting that it has a legal partnership with Odua Infraco, an affiliate of the Osun State government. MTN stated it has already remitted the right-of-way fees for the fibre cables it deployed across the state.
The Osun State government had accused MTN of disregarding laws and regulations governing fibre optic cable deployment in the state, insisting on paying a ₦900 million tax debt.
The state’s Ministry of Innovation, Science, and Technology also petitioned the Nigerian Communications Commission (NCC), alleging that MTN had withheld crucial information regarding its partnership with Odua Infraco for the fibre cable deployment. MTN responded to the NCC with explanations addressing the regulatory queries.
MTN clarified that its fibre cable deployment in the state was based on a legal agreement with Odua Infraco and that it had complied with all requirements and approvals issued by the state government. The company further stated that the Osun State government, through its consultant GTNL, had made "unsubstantiated claims of outstanding tax obligations" and requested payment through the consultant.
The telco asserted that it had settled its right-of-way (RoW) fees with Odua Infraco according to the contract between Osun State and Odua. It claimed that the real issue lies in the dispute between Osun State government and Odua Infraco over the RoW fees for fibre cable deployment. MTN advised that the parties resolve their differences without disrupting existing agreements with RoW right holders.
This development follows a week after MTN renegotiated tower leasing contracts with IHS Towers, which is expected to boost its margins and address its negative equity position in the country. The company, having faced a significant decline in service revenue in Q1 2024, sought this deal to improve its performance in Q2.
Despite scheduling meetings with the Commissioner for Finance, the Commissioner for Environment and Sanitation, and the state’s Attorney General, MTN’s efforts to resolve the tax debt issue have so far been unsuccessful.
MTN Nigeria has claimed to have paid ₦543.9 billion in taxes and levies to the Nigerian government, yet it recorded an after-tax loss of ₦137 billion in 2023. The MTN Group forewarned of a sharp decline in earnings for its half-year report, primarily impacted by its Nigerian subsidiary.
