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The largest wireless carrier in Africa, MTN Group Limited, has declared that a tax bill for GH8.2 billion ($672 million) it received from the Ghana Revenue Authority (GRA) has been canceled.
According to a filing by MTN on Friday, Ghana’s decision followed “extensive and fruitful discussions” during a 21-day negotiation period between the revenue authority and the mobile phone operator (February 3, 2023).
The Ghana Revenue Authority this month surprised Ghana’s largest corporate taxpayer with a claim for the years 2014 to 2018, which led to the decision to drop the tax bill.
According to Bloomberg Intelligence analyst John Davies, the possible penalties amounted to nearly 5% of MTN’s market capitalization, and the government’s decision “removes a danger to this year’s shareholder returns.”
The Ghanaian government has been requesting millions of dollars in past taxes from some of the biggest businesses in the country.
Similar bills were sent to Gold Fields Limited, Kosmos Energy Limited, and Tullow Oil Plc.
The businesses all refute the government’s assertions.
Ghana’s rising debt and loan-service costs prevented it from accessing global finance markets.
The majority of the government’s earnings must now go toward paying down an estimated GH576 billion in public debt.
In response to a decline in the Cedi, it is restructuring the majority of its debts and asking the IMF for a $3 billion loan.
Source: Ghanatodayonline.com
