MTN to Pay $2b Tax Penalty- Government insists

The Federal Government has insisted that telecommunications firm, MTN, must pay the $2 billion tax penalty slammed on it by the office of the Attorney-General of the Federation.

At hearing of the case yesterday, government lawyer, Tijani Gazali, according to Bloomberg, prayed the Lagos High Court to throw out the Johannesburg-based company’s application to stop it from paying backdated taxes.

However, MTN’s counsel, Wole Olanipekun, said the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, who imposed the penalty, lacked the powers to do so.

The firm had previously denied it did not pay taxes properly in the West African nation. The case was adjourned until May 7.

Meanwhile, the matter resulted in MTN shares falling as much a 6.8 per cent, the most since October 5 before paring losses to 0.1 per cent by close in Johannesburg.

The share price has fallen 16 per cent since it was hit by a double Nigerian penalty in mid-2018.

The Central Bank of Nigeria first ordered it to transfer $8.1 billion of repatriated dividends back to the country before Malami announced the measure on taxes.

The company settled the former dispute in December, agreeing to send back $53 million and clearing itself of any wrongdoing.