- Egypt's Orascom Telecom has vowed to contest a $600 million tax bill issued by the Algerian tax authorities.
Orascom has said the Algerian tax demand of $596.6 million from its subsidiary Orascom Telecom Algeria was based on an unfounded and unacceptable allegation that it did not keep proper accounts in 2005-2007, further indicating that its books were audited by local and international accountants.
The Algerian tax regulator had previously said Djezzy owed $50 million in taxes from 2004, which Orascom also disputes.
The tax bill coincides with the recent spat between Algeria and Egypt as both countries prepared for World Cup qualifier final played in Sudan yesterday.
The company said the tax claims could reduce 2010 dividends from its Algerian unit, which operates a mobile network under the brand name Djezzy, and is serving over 14.5 million mobiles phones in the North Africa state.
Orascom, based in Cairo, said it was planning to 'take all necessary legal steps to challenge the reassessment through all available administrative and judicial channels to defend its reputation, integrity and rights’.
Local reports said Orascom has long been battling Algerian authorities over a new tax law requiring foreign firms to prove they do not owe tax before they can repatriate dividends.
The company said in September it had received permission to repatriate half of its 2008 dividends to non-resident shareholders.
It acquired a 15-year mobile telephone license in Algeria in 2001 for $737 million.
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