Tax dispute between Nigeria, MTN adjourned until October
THE case between the Nigerian government and South African telecommunication giant, MTN, on Wednesday had been adjourned until October 19.
The case harps on the need to resolve a tax dispute of $2 billion being demanded by Nigeria’s attorney general, Abubakar Malami on behalf of the president.
Earlier in September, Malami had ordered MTN to pay back taxes of about $2 billion, following a demand by the Central Bank of Nigeria (CBN) that the telecommunication company should refund the sum of $8.1 billion it repatriated as profit out of Nigeria based on “irregular certificates of capital importation”.
MTN had sued the CBN and the AGF, following the allegations and had said the AGF exceeded his powers in making such a demand which was without merit.
The telecommunications service is among the four Nigerian banks fined of N5.87 billion by CBN for allegedly “breaching Nigeria’s forex regulations on MTN’s illegal capital repatriation”.
Last December, MTN agreed to make about $53 million payment to resolve the dispute and clear itself of any wrongdoing, of which MTN Nigeria and the CBN had agreed it would pay a notional reversal of $52.6 million without admission of liability.
Reports say MTN’s shares had recovered from their biggest decline since October to close almost flat on the Johannesburg Stock Exchange. It also fell as much a 6.8 percent, the most since last October, before trimming losses to 0.1 percent by the close of trade.
Reports noted that MTN’s share price had fallen over 19 per cent for over 12 months as at March, and dropped 16 percent since it was hit with the repatriation penalty in mid-2018.
Nigeria is MTN’s biggest market, with 58 million users in 2018 and it accounts for a third of the South African firm’s core profit, but it has proven problematic for the company in recent years.