Nigerian tax authorities have given the entertainment conglomerate MultiChoice until next month to prove its commitment to comply with regulatory directives, until a final decision is made on whether to levy a R4.4 billion fine. Picture: Simphiwe Mbokazi
Nigerian tax authorities have given the entertainment conglomerate MultiChoice until next month to prove its commitment to comply with regulatory directives, until a final decision is made on whether to levy a R4.4 billion fine. Picture: Simphiwe Mbokazi

MultiChoice Nigeria survives hangman’s noose until October

By Banele Ginindza Time of article published Sep 27, 2021

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NIGERIAN tax authorities have given the entertainment conglomerate MultiChoice until next month to prove its commitment to comply with regulatory directives, until a final decision is made on whether to levy a R4.4 billion fine.

The saga which began earlier this year has taken several dramatic twists akin to communications giant MTN, which also a couple of years back faced the censure of Nigerian authorities over disputed regulatory issues, involving the non-disclosure of subscribers.

On Thursday, Nigerian media reported that the Federal Inland Revenue Service’s (Firs’) tax appeal tribunal postponed a decision to October 10 for MultiChoice to prove it had deposited the first tranche of the fine, which the group claimed it had paid as part of its statutory tax obligations.

MultiChoice is on the coals for alleged non-compliance with tax issues for which it had been handed down a 1.8 trillion naire (R65 264) fine, payable in two tranches after strenuous negotiations.

At Thursday’s hearing, counsel to MultiChoice said the company had complied with the payment – paid in two tranches to the Firs account as instructed by the tribunal on the provision of the Firs Act.

At the last hearing in August, the Tax Appeal Tribunal (TAT) had upheld the Firs submission and directed MultiChoice to pay Firs 50 percent of the assessment under the appeal plus a sum equal to 10 percent of the said deposit as a condition for further hearing of the appeal. The directive had generated confusion among stakeholders as Firs had asked the company to pay 50 percent of the disputed sum (N900bn) under assessment.

MultiChoice, in an affidavit of compliance, said it had made payments on September 9 and 22.

“An assessment of N1.8trln was levied on the appellant. There was no science to it and the respondent contrived the numbers. The reality of the appellant’s business is far from what the respondent fixes in its office.”

MultiChoice said: “What they have done is to selectively pick and choose the preceding year to reckon with. They chose 2010 and made a deposit and they turned back to choose 2019 as another preceding year of N5.3bn.”

Firs urged the tribunal to ask MultiChoice to make payment for all preceding years under appeal. “Our submission is that there are 10 consecutive years, and 2010 or 2019 can’t be proceeding years to 2011,” the tax authority said. “Our submission is that the assessment under appeal ought and should be confirmed by this tribunal.”

The Lagos zone of the TAT hearing about the tax dispute between the Firs and MultiChoice Nigeria has fixed October 20 to rule on the matter.

The tribunal made the announcement at the resumed hearing to demand proof of deposit of N900bn, 50 percent of the alleged tax liability, it ordered MultiChoice to make on August 24, before the continuation of its appeal.

MultiChoice, however, stated that it has complied, as the referenced section of the Firs Act does not compel it to pay N900bn, but an amount equal to its tax in the preceding year of assessment or one half of the disputed tax assessment under appeal, whichever is the lesser amount plus 10 percent.

MultiChoice denied that it receives most of its revenue through online channels, stating that its dealers and agents sell decoders and dishes for cash, while it receives most of its payments in its bank accounts.

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