Osun State Government, through its consultant, Global Transaction Nigeria Limited (GTNL), made claims of outstanding tax obligations against MTN Nigeria, and requested that they be paid through the consultant, but findings by Techeconomy indicate otherwise.
Recall, Osun State government accused MTN of owing over N900 million in unpaid taxes, urging the Nigerian Communications Commission (NCC) to step in and resolve the issue.
The development followed MTN’s recent donations to the federal government despite the alleged debt.
Rotimi George-Taylor, a consultant to the Osun State Government on telecommunications infrastructure and chairman of Global Transactions Limited, voiced his concerns during a press conference on Tuesday in Osogbo, the state capital.
He criticised MTN for donating N1 billion to the federal government’s food support programme and providing 4,600 digital devices to schools while allegedly neglecting its tax obligations to Osun State government.
Techeconomy gathered that the State Government though the consultants petitioned NCC on the matter, however, our correspondent sighted the telecommunication company’s response to NCC in which it denied owing the quoted sum in taxes.
The Genesis
According to MTN’s response to NCC, the telco had signed a Memorandum of Understanding with O’Odua Infraco to leverage the state’s ‘Dig Once’ policy for broadband rollout.
MTN has settled its Right-of-Way (RoW) fees to Odua Infraco based on the binding RoW contract between Osun State and Oodua.
“If there is an attempt by Osun State government to severe ties with Odua Infraco, this shouldn’t impact existing agreement with RoW right holders (Odua and Osun should resolve their differences in the overall interest of ease of doing business)”, the MTN argued.
“During the period referenced, MTN legally partnered with the Odua Investment Company – in which the Osun State government has a significant shareholding, to lay cable in their fibre ducts in the state.
“This was based on the documented existing right of way approvals for Odua’s ducts provided by the Osun State Ministry of Innovation, Science and Technology;
“The actual dispute is between Osun State government and Odua Infraco over the right-of-way (RoW) fees for fibre infrastructure deployment. Odua Infraco has the right of way for 1031.44 kilometres across four states (Osun, Oyo, Ondo and Ekiti States) for the construction and operation of fibre infrastructure, for which MTN executed an IRU with Odua;
“The relationship between Oodua and the Osun State government is governed by a May 2023 Right of Way & Easement Agreement. MTN demanded an additional letter of no objection from Odua for the transaction. However, it appears the state government is no longer interested in the relationship with Odua following the state’s appointment of Global Transaction Nigeria Limited (GTNL) as a consultant on telecommunications infrastructure and the alleged termination of the agreement with Odua.
“Ignoring the existing agreement with Odua, the state government, via a letter dated 19th April 2024 (from the Special Adviser on legal matters to the Governor) demanded for the payment of N945,000,000 as Right of Way (RoW) fees for 270KMs of fibre optic and a penalty fee of N100,000,000 for the alleged non-payment of RoW. Meanwhile, the RoW is already covered under MTN’s existing agreement with Odua”;
“Almost universally, Nigerian state governments have acknowledged the importance of affordable right of way charges to enable the growth and development of an inclusive digital economy”.
Actions taken by MTN to settle the matter:
According to the document sighted by our correspondent, MTN had engaged and met with members of the Executive Council of Osun State such as the commissioners for Finance & environment & sanitation and the Attorney General, to amicably resolve the issue.
“However, all efforts have not yielded the desired result;
“We advised Odua to settle its disagreement with the state government;
“MTN has suspended all payments to Odua until the matter is resolved;
“Sought the NCC’s intervention following a complaint filed with the NCC by the GTNL.
Unanswered question:
Should consultants be mandated to collect tax revenue directly on behalf of government as opposed to receiving payments directly from government?
As at the time of filling this report, the NCC has not made public its position on the matter.
Joan Aimuengheuwa