MTN Gets Relief in Shs169.9 Bn Tax Case

MTN Uganda has secured a major reprieve in its tax dispute with the Uganda Revenue Authority (URA), after the Tax Appeals Tribunal ruled that the company may not be required to immediately pay part of a contested Shs169.9 billion tax bill linked to mobile money transactions.

The dispute stems from a wide-ranging URA audit covering MTN’s operations between December 2019 and December 2022. The tax authority initially assessed the telecom firm at more than Shs1.54 trillion in taxes, including Value Added Tax (VAT), Local Excise Duty (LED) and Corporate Income Tax (CIT).



URA said the assessments were based on alleged issues such as under-declared revenue, duplicated records, and inconsistencies in MTN’s airtime, data bundles and mobile money transactions. These included mismatches in call data records (CDRs), refill records and mobile money transaction logs. 

Following objections from MTN, the initial tax bill was significantly reduced to about Shs260.1 billion, mainly relating to airtime and bundle purchases. 

However, URA later carried out a separate audit focused on mobile money (MoMo) transactions. From this, it issued revised figures that fluctuated from about Shs870.4 billion to Shs688.9 billion and then Shs566.2 billion as more data was reviewed. 

Eventually, in December 2025, URA issued an objection decision setting MTN’s mobile money-related tax liability at Shs169.9 billion and demanded that the company pays 30% upfront—about Shs50.9 billion—before proceeding with its appeal. 

What the tribunal found

MTN challenged both the tax and the requirement to pay the 30%, arguing that URA had not properly followed the law when issuing the assessment.

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The tribunal agreed that there were gaps in the process.

“The material before us does not clearly demonstrate that a formal assessment… was issued prior to the objection decision,” the judges ruled.



The panel said URA appeared to rely on audit letters and internal communications instead of issuing a clear, formal tax assessment.

“In other words, the Respondent has treated the management letter… as an assessment,” the tribunal noted. 

The judges emphasized that tax disputes must follow a proper legal sequence—assessment, objection, and then a decision.

“Due process… requires tax authorities to act fairly, transparently, and within legal bounds,” the ruling stated. 

On the 30% payment

Under Ugandan law, companies are usually required to pay 30% of a disputed tax before their case is heard—a system known as “pay now, argue later.”

But the tribunal clarified that this rule only applies if the tax process itself is valid.

“While we recognise the ‘pay now, argue later’ principle… the obligation arises within a valid process,” the judges said. 

This means MTN may not have to immediately pay the Shs50.9 billion while the dispute is still being properly handled.