The Tax Appeal Tribunal (TAT) sitting in Lagos, on Tuesday August 24, ordered the owners of the cable television service DSTV, MultiChoice Nigeria Limited, to pay N900 billion to the Federal Inland Revenue Service (FIRS). This represents 50 per cent of N1.8 trillion which the Federal Inland Revenue Service (FIRS) has determined through a forensic audit as amount MultiChoice owes in taxes. The Tribunal gave the order consequent upon an application by counsel to FIRS.
The Director of Communications and Liaison Department at the Federal Inland Revenue Service Abdullahi Ismaila Ahmad confirmed this in a statement issued on Wednesday.
According to the statement, the FIRS counsel made the application under Order XI of the TAT Procedure Rules 2010 which enables a party to make an application at any stage of the proceedings.
Counsel for FIRS drew the attention of the Tribunal to Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 and urged the tribunal to direct MultiChoice Nigeria Limited to deposit with the FIRS 50 per cent of the amount of the assessment under appeal as security, the same being a mandatory requirement before a tax appeal may be heard.
MultiChoice Nigeria Limited approached the Tax Appeal Tribunal following its dispute over FIRS’ issuance of notices of assessment and demand note in the sum of N1. 822 trillion on April 7, 2021.
The amount constitutes what the FIRS calculated as due in taxation to the Federal Government of Nigeria from MultiChoice after an investigation over several months to determine the extent to which the firm has been evading taxes in Nigeria.
After hearing arguments from counsels of MultiChoice Nigeria Limited and Federal Inland Revenue Service (FIRS), the Tax Appeal Tribunal upheld the FIRS submission and directed MultiChoice Nigeria Limited to deposit with the FIRS, an amount equal to 50 per cent of the assessment under the appeal, including a sum equal to 10 per cent of the said deposit as a condition precedent for further hearing of the appeal.
The Tribunal adjourned the appeal to September 23, 2021, for a report of compliance with its order and continuation of the hearing, subject to compliance with the Order of the Tribunal.
Recall, that the FIRS had, in July 20021, engaged some commercial banks as agents to freeze and recover N1.8 trillion from accounts of MultiChoice Nigeria Limited and MultiChoice Africa.
The FIRS explained that 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.