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During the first half of 2026, MTN Nigeria Communications Plc recognized ₦68.10 billion in prepaid road infrastructure tax credits under the Federal Government’s Road Infrastructure Development and Refurbishment Investment Tax Credit (RITC) Scheme.
The expenditure represents capital deployed directly toward the ongoing dualization and reconstruction of the 110-kilometer Enugu-Onitsha Expressway.
The RITC framework enables private corporate entities to fund critical public infrastructure projects approved by the Federal Executive Council (FEC) and offset 100% of the total project costs (plus an eligible cost-plus margin) as a direct naira tax credit against future Companies Income Tax (CIT) liabilities until full cost recovery is achieved.
Strategic & Balance Sheet Implications
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Cash-Tax Shield Efficiency: MTN Nigeria’s strong H1 2026 operating performance—reporting a Profit Before Tax of ₦1.09 trillion—would ordinarily trigger substantial gross corporate income tax liabilities. Utilizing the RITC mechanism allows MTN to convert cash tax outflows into a tangible, high-impact public infrastructure asset.
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Liquidity & Cash Flow Optimization: Rather than paying direct tax cash directly into federal accounts, capital deployment into the Enugu-Onitsha corridor enhances corporate goodwill and improves supply-chain logistics across eastern commercial hubs while ensuring 100% principal recovery through future tax relief.
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Balance Sheet Recognition: The ₦68.10 billion spent is classified as a non-current prepayments/tax credit asset on MTN Nigeria’s balance sheet. As the Federal Inland Revenue Service (FIRS) verifies completed construction milestones, the balance transfers out of prepayments to offset accrued CIT obligations.
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Read Full Article by Bala Augie at moneycentral.com.ng
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