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VENTURES AFRICA – Orascom Industries Limited (OCI), a subsidiary of Amsterdam-listed OCI NV, has suspended tax settlements to the Egyptian government, the company has revealed.
“The suspension was part of the appeals and reinstated litigation process of OCI’s ongoing dispute with the Egyptian Tax Authority” OCI NV told Reuters.
Orascom, an Egyptian conglomerate that produces gas-based chemicals as well as provide engineering and construction services, was accused last year of evading a LE14 billion ($2 billion) tax payment following the sale of Orascom Building Material Holding to French cement manufacturer Lafarge for $12 billion in 2007, a report by Reuters confirmed.
It subsequently reached an agreement to pay LE7.1 billion in ten instalments, with an initial outlay of LE2.5 billion ($358 million) mid last year, followed by a LE900 million due in December, the payment Orascom has suspended.
It was earlier reported that the chemical producer was referred to the country’s public prosecution by Egyptian Tax Authority (ETA) for its refusal to remit the payments, with the head of taxpayers’ department, Osama Tawakol, offering a stern warning that “the authority cannot give up the rights of the state’s public treasury.”
In response to the reports, Orascom released a statement to the Stock Exchange, stating that no new complaint from the tax office had been brought to its knowledge.