MTN Nigeria has rejected claims that it owes ₦900 million in taxes to the Osun State government.
The accusation, made by the state’s consultant, Global Transactions Nigeria Limited (GTNL), alleged that MTN Nigeria installed over 270 kilometres of fibre cables without paying the required taxes.
MTN has denied the debt claims, stating it has a legal partnership with Odua Infraco, an affiliate of the Osun State government. The company asserts it has already paid the right-of-way fees for the fibre cables installed in the state.
The Osun State government had accused MTN of violating laws related to fibre optic cable deployment and demanded ₦900 million in taxes.
The state’s Ministry of Innovation, Science, and Technology also contacted the Nigerian Communications Commission (NCC), alleging that MTN withheld important information about its partnership with Odua Infraco. MTN has responded to the NCC, providing explanations to address the regulatory concerns.
MTN clarified that its fibre cable work in the state was done under a legal agreement with Odua Infraco and that it followed all necessary requirements and approvals from the state government. The company criticized GTNL for making “unsubstantiated claims” and requesting payment on their behalf.
According to MTN, it has settled its right-of-way (RoW) fees with Odua Infraco based on the contract between Osun State and Odua. The company suggested that the dispute is actually between the Osun State government and Odua Infraco over the RoW fees, and advised that these issues be resolved without affecting existing agreements.
This situation comes shortly after MTN renegotiated its tower leasing contracts with IHS Towers, which is expected to improve its margins and address its negative equity in Nigeria. The company had faced a significant drop in service revenue in Q1 2024 and is aiming to improve its performance in Q2.
Despite attempts to resolve the issue with meetings involving the Commissioner for Finance, the Commissioner for Environment and Sanitation, and the state’s Attorney General, MTN’s efforts have not yet succeeded.
MTN Nigeria has reported paying ₦543.9 billion in taxes and levies to the Nigerian government but recorded a ₦137 billion after-tax loss in 2023. The MTN Group has warned of a sharp decline in earnings for its half-year report, largely due to challenges faced by its Nigerian subsidiary.
