Algeria hits Orascom unit with new back taxes-sources

Algeria's government has decided to demand new back-taxes from Orascom Telecom's local unit Djezzy, adding to previous tax claims totalling over $600 million, industry and government sources told Reuters.

Algeria's central bank has also notified justice officials about a suspected false declaration by Djezzy's Director-General relating to the unit's financial operations, the same sources told Reuters.

An Orascom Telecom spokeswoman at the company's headquarters in Cairo and a Djezzy spokesman in Algiers both said they had no comment when contacted by Reuters about the back tax demand and the central bank complaint.

Asked by Reuters about the back tax demand, an Algerian Finance Ministry official declined to comment. An official with the Banque d'Algerie, or central bank, said no one was available to comment.

"A decision has been taken to impose new back taxes on Djezzy. Notification will be received in the next few days. We are talking about several million dollars," said a source close to Algeria's telecoms industry.

"A complaint has been lodged by the Banque d'Algerie against the director-general of Djezzy," said the source, who did not want to be identified.

The new back tax claim and the central bank complaint were confirmed by a government official with direct knowledge of Djezzy's dealings with the government, who spoke on condition of anonymity.

The government official declined to give a figure for the size of the back-tax claim.

Orascom Telecom agreed to talks on selling Djezzy, the company's biggest source of revenue, to the Algerian state after the government imposed earlier back-tax claims and blocked negotiations to sell the unit to South Africa's MTN.

Orascom Telecom's chairman has accused the Algerian authorities of pressuring Djezzy, but Algeria's Telecommunications Minister last week denied applying any pressure.