Why FG Fined Multichoice N900 Billion

A Tax Appeal Tribunal, TAT, sitting in Lagos has ordered Multichoice Nigeria Limited to deposit 50 per cent of the disputed N1.8 trillion tax with the Federal Inland Revenue Service, FIRS.

FIRS spokesman, Abdullahi Ahmad, disclosed this in a statement, yesterday.

Multichoice is the owner of the satellite televisions, DStv and Gotv, popular subscription-based platforms in Nigeria

In July, the FIRS had appointed some commercial banks agents to recover N1.8 trillion from accounts of MultiChoice Nigeria Limited, MCN, and MultiChoice Africa, MCA.

Muhammad Nami, FIRS chairman, had said the decision to appoint the banks as agents and to freeze the accounts was a result of the group’s continued refusal to grant FIRS access to its servers for audit.

At the resumed hearing, yesterday, the five-member TAT, led by A.B. Ahmed, issued the order, following an application brought to the tribunal by counsel to FIRS.

“The counsel made the application under Order XI of the TAT Procedure Rules 2010 which requires Multichoice or any other taxpayer who disputes their tax assessments, to make the statutory deposit required under Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) as a condition that must be fulfilled before the prosecution of the appeal brought before TAT.

A Tax Appeal Tribunal, TAT, sitting in Lagos has ordered Multichoice Nigeria Limited to deposit 50 per cent of the disputed N1.8 trillion tax with the Federal Inland Revenue Service, FIRS.

FIRS spokesman, Abdullahi Ahmad, disclosed this in a statement, yesterday.

Multichoice is the owner of the satellite televisions, DStv and Gotv, popular subscription-based platforms in Nigeria

In July, the FIRS had appointed some commercial banks agents to recover N1.8 trillion from accounts of MultiChoice Nigeria Limited, MCN, and MultiChoice Africa, MCA.

Muhammad Nami, FIRS chairman, had said the decision to appoint the banks as agents and to freeze the accounts was a result of the group’s continued refusal to grant FIRS access to its servers for audit.

At the resumed hearing, yesterday, the five-member TAT, led by A.B. Ahmed, issued the order, following an application brought to the tribunal by counsel to FIRS.

“The counsel made the application under Order XI of the TAT Procedure Rules 2010 which requires Multichoice or any other taxpayer who disputes their tax assessments, to make the statutory deposit required under Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) as a condition that must be fulfilled before the prosecution of the appeal brought before TAT.

“In certain defined circumstances to which the Multichoice appeal fits, Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) requires persons or companies seeking to contest a tax assessment to pay all or a stipulated percentage of the tax assessed before they can be allowed to argue their appeal contesting the assessment at TAT,” the statement read.

The FIRS said Multichoice filed a suit at the Lagos TAT, following its dispute over the agency’s issuance of notices of assessment and demand note in the sum of N1, 822, 923,909,313.94k on April 7, 2021.

But reacting yesterday, MultiChoice said:  “MultiChoice Nigeria has noted today’s (yesterday) media statement on the Tax Appeal Tribunal (“TAT”) appeal hearing held on August 24,2021.

‘’The direction issued by the TAT does not compel MultiChoice Nigeria to make payment of 50 per cent of N1,8 trillion, being half of the disputed tax assessment which is under appeal.

‘’The direction issued by the TAT in accordance with paragraph 15(7) of the Fifth Schedule to the FIRS Establishment Act requires MultiChoice Nigeria to deposit with FIRS an amount equal to the tax paid by MultiChoice Nigeria in the preceding year of assessment OR one half of the disputed tax assessment under appeal, whichever is the lesser amount plus 10%.

‘’The lesser amount is the tax paid by MultiChoice Nigeria in the previous assessed year which is substantially less than the disputed assessment.

‘’MultiChoice Nigeria is a law-abiding corporate citizen and continues to engage constructively with FIRS in an attempt to resolve this matter.”