A Federal High Court in Lagos has upheld the $87.9 million fines and interests that the Federal Inland Revenue Service (FIRS) imposed on MTN Nigeria Communications Plc.

The court upheld these fines while ruling on the appeal filed by the FIRS against the Tax Appeal Tribunal’s (TAT) decision of October 20, 2023.

In its judgement, the Tax Appeal Tribunal did not grant the penalties and interests of $87.9 million as requested by the FIRS, although it awarded the principal sum of $71 million on MTN.

FIRS in its appeal asked the court to give an order allowing the appellant to pursue and claim all penalties and interest coming from the principal sum of $71 million awarded by the Tribunal in its judgment dated October 20, 2023.

The tax administrator also asked the Federal High Court to determine if the Tribunal was right to refuse to grant the Appellant (FIRS) the accumulating penalties and interest, even after determining that the goods and services purchased by the Respondent (MTN) were subject to value-added taxes.

In its response to the suit, MTN insisted that the TAT was right to have dismissed penalties and interests imposed on the principal VAT liabilities, in line with Sections 13(2) and (3) of the 5th Schedule to the FIRS Act.

The judgment reads: “The decision of the TAT contained from page 750 of the record to the effect that interest and penalty are not due to be paid by the respondent to the appellant is hereby set aside.

"This appeal, therefore, succeeds. I grant the three reliefs sought, as prayed.”

MTN and other TelCos recently threatened to cut off banks' USSD code services over owed sums, but did not continue with the decision after the banks paid up.