MTN Nigeria Clears Air on Alleged Inflated Tax Figure
Ahead of its N200 billion second bond issuance, MTN Nigeria Plc has come out to claim its tax remittances were in order, though there appear to be certain discrepancies that are yet to be settled.
Meanwhile, the stock market had absorbed the company’s strong performance as shares rise sharply in a short period but would there be a repricing amidst the unsettled dust over its inflated tax figure?
A positive expectation over the company’s earnings performance has lifted the stock market valuation above Dangote Cement as the price inched upward steadily while equities investors struggle to take positions. Today, MTN Nigeria’s share closed at N229 on the local bourse.
Reacting to discrepancies noted by This day and other newspapers in its tax payment figure, MTN Nigeria said the company paid a total sum of N291.7 billion as direct remittance to Federal Inland Revenue Services (FIRS) in 2021, according to a statement submitted to the regulator.
Earlier, MTN had claimed in the publication that the N618.7 billion it paid to FIRS in 2021 represents 13% of N6.4 trillion revenue.
In providing the clarification, the telecom company explained that as of 31 December 2021, it made a total contribution of up to N757.7 billion to the Federal Government of Nigeria and its relevant agencies through taxes, levies, fees and duties.
Recalled that FIRS recognised twenty taxpayers in the country for their commendable contribution and support for the growth of the Nigerian economy. It expressed its appreciation to them for making it possible to achieve remarkable tax collection performance in 2021.
MTN Nigeria said the company’s direct remittances to FIRS in 2021 were N291.7 billion, split as N98.992 billion as total VAT on revenue, Withholding Tax of N71.179 billion. The telecom revealed it paid N99.286 billion as company income tax and N8.467 billion as stamp duties collection including N10.644 billion as education tax.
It said the telecom company also remitted N3.092 billion as IT levy while the balance represents VAT, levies, fees and duties paid to other Federal Government agencies.
“MTN Nigeria is a tax compliant organisation with all its tax obligations settled. This is backed by the FIRS’ testimonial naming MTN Nigeria as one of the most tax compliant organisations in Nigeria for the year 2021”, the statement reads.
Nigeria’s leading telecom operator said it has applied to the Securities & Exchange Commission in respect of the registration of a new N200 billion second Bond Issuance Programme, according to the statement submitted to the regulators.
It said this follow-on to the successful N200 billion debut Bond Issuance Programme in 2021 under which MTN Nigeria issued the N110 billion 13.00% 7 Year Series I bonds due 2028 and N90 billion 12.75% 10 Year Series II bonds due 2031.
In the statement, the management said the company is committed to paying all taxes due and on time and has zero tolerance for non-compliance. MTN Nigeria said it will decide on issuances under the Second Bond Issuance Programme in due course subject to prevailing market conditions and obtaining relevant regulatory approvals.
Proceeds of the bond issuance will be used for capital expenditure (network expansion), working capital management and general corporate purpose, according to the management. # MTN Nigeria Clears Air on Alleged Inflated Tax Figure