International Finance

MTN Nigeria seeks tribunal review on its $1 bn fine

MTN Nigeria fine
The company is in disagreement with the Federal Inland Revenue Service with regards to tax deductions from the fine

Telecom giant MTN Nigeria has asked a tax tribunal to review whether the company should or shouldn’t pay corporate tax on a $1 billion fine. According to the company, it had a technical disagreement with the Federal Inland Revenue Service regarding tax deductions from the fine.
The telecom company has asked for the judicial review after the Federal Inland Revenue Service disagreed with the company recording the fine as an operating cost in its books.
Tunde Fowler, chairman of the Federal Inland Revenue Service told the media that, “One cannot be given a penalty or fine, which is a punitive measure, and the company is saying it is tax-deductible so that it will get a tax credit on that.”
He added that the alternative is for MTN to go to court and let the court decide whether such fines or penalties are tax-deductible.
According to the company, it fully remains compliant with Nigerian tax laws and will abide by the findings of the tribunal.
The company was fined in 2015 for its failure to deactivate five million unregistered SIM cards in Nigeria. It negotiated a structural payment plan with the Nigerian Communications Commission for the payment. The payment was finally completed on May 31 this year.
MTN Nigeria has posted strong results with service revenue increasing by 12.2 percent, voice revenue by 11.4 percent and data revenue by 31.7 percent. Digital revenue also increased by 64.5 percent.
The company listed on the Nigerian stock exchange earlier in May.
As of 2018, MTN had 58 million users in Nigeria.

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