MTN vows to fight on in Shs 260 Billion tax dispute with URA

The ongoing standoff originates from August 2023, when the URA initiated a tax investigative audit of Uganda’s telecom sector, including MTN Uganda.

The audit sought to evaluate tax compliance for the years 2018 to 2022, focusing on taxes related to both international and domestic phone call revenues.

Initially, the unremitted taxes were assessed at a staggering $410 million (Shs 1.5 trillion), but this figure was later reduced to $71 million following further reviews.

Despite the reduced assessment, MTN has challenged the URA’s findings. The company, which today announced its financial results for the nine months ending September 30, 2024, informed shareholders of its ongoing engagement with the URA.

“MTN maintains that the revised assessment does not accurately reflect our operations or compliance with tax obligations. We are continuing to engage the URA in constructive dialogue and are confident that the ongoing discussions will result in a fair resolution,” the company said.

MTN Uganda emphasised that it has cooperated fully with the tax audit process, providing extensive data and the necessary clarifications in a transparent manner.

The company reiterated its commitment to upholding the highest standards of corporate governance and compliance with all regulatory and legal obligations.

“MTN assures its subscribers, stakeholders, and the general public that we remain a responsible corporate citizen,” the statement added.

The tax dispute has come at a time when the Global System for Mobile Communications (GSMA), an international body representing telecom operators, is advocating for more balanced tax policies.

The GSMA is calling on governments worldwide to eliminate sector-specific fiscal demands and streamline tax structures in line with globally accepted standards. The organisation has argued that regulatory and tax reforms are needed to create a more equitable digital ecosystem and to encourage investment.

The push for tax rationalisation has been echoed by leaders from Africa’s major telecom companies.

CEOs of prominent telecom firms, including Segun Ogunsanya of Airtel Africa Group, Hassanein Hiridjee of Axian Group, Frehiwot Tamru of Ethio Telecom, Ralph Mupita of MTN Group, Jerome Henique of Orange Middle East and Africa, and Shameel Joosub of Vodacom Group, have urged governments to reconsider tax policies impacting the sector.