MTN Nigeria, a leading telecommunications company, has dismissed allegations that it owes ₦900 million in taxes to the Osun State government for the installation of fibre optic cables. The state government, represented by its consultant Global Transactions Nigeria Limited (GTNL), had accused MTN of laying over 270 kilometres of fibre without settling the required taxes.
Contradicting these claims, MTN maintains that it has fulfilled all its tax obligations through a lawful partnership with Odua Infraco, which is affiliated with the Osun State government. The company asserts that it has paid the necessary right-of-way fees for the fibre optic cables installed throughout the state.
Amidst these conflicting statements, the Osun State government has charged MTN with non-compliance with the state’s laws and regulations concerning the deployment of fibre optic infrastructure, demanding the payment of a ₦900 million tax liability.
Furthermore, the Osun State Ministry of Innovation, Science, and Technology has lodged a complaint with the Nigerian Communications Commission (NCC), claiming that MTN failed to disclose essential details about its collaboration with Odua Infraco for the fibre optic project. In response, MTN has provided the NCC with detailed explanations to address the regulatory concerns raised.
MTN has reiterated that its fibre optic network expansion in Osun State is based on a legitimate agreement with Odua Infraco and that it has adhered to all the stipulations and permissions granted by the state authorities. The telecom giant also highlighted that the Osun State government’s consultant, GTNL, has made unfounded accusations regarding outstanding tax duties and has sought payments through the consultancy.
The company has emphasized that it has already settled the right-of-way fees directly with Odua Infraco as per the terms agreed upon with the Osun State government. MTN suggests that the crux of the matter is a disagreement between the Osun State government and Odua Infraco concerning the right-of-way fees related to the fibre optic cable deployment. MTN recommends that the state government and Odua Infraco resolve their differences amicably to avoid disrupting the existing right-of-way agreements.
Recently, MTN Nigeria engaged in a strategic move to renegotiate its tower leasing agreements with IHS Towers, a decision aimed at enhancing its profit margins and addressing the negative equity position it faces within the country. This action came on the heels of a challenging first quarter in 2024, during which the company experienced a significant drop in service revenue. By entering into this new arrangement with IHS Towers, MTN aims to bolster its financial performance for the second quarter.
In an attempt to settle the ongoing tax dispute with the Osun State government, MTN Nigeria has proactively sought dialogue with key state officials, including the Commissioner for Finance, the Commissioner for Environment and Sanitation, and the state’s Attorney General. Despite these efforts to reach an amicable resolution, the meetings have yet to yield a successful outcome.
MTN Nigeria has publicly disclosed that it has contributed a substantial amount of ₦543.9 billion in taxes and levies to the Nigerian government’s coffers. Nevertheless, the company reported a considerable after-tax loss of ₦137 billion for the year 2023. The MTN Group, which oversees the Nigerian branch, has also issued a warning regarding an expected sharp downturn in its earnings for the mid-year financial report, attributing this forecasted decline largely to the performance of its Nigerian operations.
