South Sudan operators ‘still paying tax’ to Sudan government
More than a decade after South Sudan won independence from Sudan, local operations of Zain and MTN are continuing to pay licence fees to the government of Sudan.
Meanwhile the government of South Sudan is heavily in debt, said politician Changkuoth Bichiok, who chairs the Finance and Economic Planning Commission, last month.
The problem is that MTN and Zain obtained their licences from the government of Sudan before South Sudan won independence after a 22-year civil war followed by a referendum.
Back in 2011 the Reuters news agency reported that Zain Sudan was in talks with the new government of South Sudan to have its licence continue in the independent state.
Zain had a 57% market share in Sudan at the time, said the agency, generating revenues of $273 million from 10.7 million customers in the first quarter of 2011 – almost a quarter of Zain group’s total.
But just 6% of that revenue came from the undeveloped South Sudan.
Still, though, the two companies are paying their licence fees to their former government north of the border, Bichiok revealed in a report to the parliament of South Sudan.
He urged the government of South Sudan – largely dependent on oil revenue – to start collecting value added tax, business profits tax and excise duty from both MTN and Zain, as well as other digital service providers, as reported by the Ecofin news agency.
According to Ecofin, Zain’s licence expires in 2024, while that of MTN expires in 2027.