After resolving its tax dispute with the Ghanaian government, MTN Group, the largest mobile network operator in Africa, has announced its intention to invest US $1 billion in Ghana within the next five years. The telco wants to invest in expanding operations in Ghana for the next five years.
Group chairman and CEO Ralph Mupita made the announcement, and it comes after just two weeks after the end of a tax dispute with Ghanaian authorities. The tax claim was initially issued after the revenue authority audited the company from 2014 to 2018 and claimed that MTN had underdeclared its revenue by about 30% during the period. However, the Ghanaian government eventually exempted MTN Ghana from tax claims worth about USD 773 million.
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"To be sure, macroeconomic conditions are very difficult in the near term. That said, we are focused on the medium to long term, and we are seeing growth," said Mupita in a statement.
5G Launch and Expansion
According to Mupita, most of the funds would be used to launch and expand 5G mobile technology in the nation. The company's 4G network covers about 99.3% of the population but cannot keep up with the anticipated growth.
Tax demand from GRA
MTN was facing a tax demand for $665 million from the Ghana Revenue Authority (GRA), the South African telecoms company said in January it "strongly disputes".
The GRA stated that MTN had under-declared its income for the years 2014 to 2018. "MTN Ghana believes that the taxes due have been paid during the period under assessment and has resolved to vigorously defend MTN Ghana's position on the assessment."
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A few weeks ago, MTN declared via Johannesburg Stock Exchange that it had settled the disputes with GRA.
"Shareholders are advised that following extensive and productive discussions held during these 21 days between MTN Ghana, MTN, and relevant authorities in Ghana, the GRA has on 3 February 2023 fully withdrawn the assessment."
Ghana's decision came after "extensive and productive discussions" during a 21-day negotiation period between the West African nation's authorities and the mobile-phone operator, MTN said in a filing.
MTN Group has operations in 19 countries in Africa and the Middle East and Mupita claimed that 5G would accelerate growth in all sectors of the Ghanaian economy.