Multichoice Nigeria loses out as Tax Appeal Tribunal orders firm to pay N194bn to FIRS

*Nigeria’s Tax Appeal Tribunal orders Multichoice Africa, a South African company, to pay up its $342million tax assessment, which the Federal Inland Revenue Service had earlier given the firm as tax obligation in the West African country

Alexander Davis | ConsumerConnect

Nigeria’s Tax Appeal Tribunal (TAT) has put paid to the hitherto long-drawn legal battle between Multichoice Africa Holdings B.V, a South African company and the Nigerian Government-owned Federal Inland Revenue Service (FIRS) over the disputed $342 million tax matter.

ConsumerConnect gathered the Tax Appeal Tribunal Tuesday, Octber 26, 2021, dismissed Multichoice Africa’s appeal for want of diligent prosecution.

The Tribunal also ordered the company to pay up the $342 million tax assessment, which FIRS, the country’s tax administration regulator, had earlier given it to pay as tax obligation in Nigeria.

Multichoice Africa Holdings is the parent company of Multichoice Nigeria, which had  engaged FIRS in court to challenge the assessment of the Nigerian tax regulator over its unpaid Value-Added Tax (VAT) amounting to over $123.7million.

While delivering its judgment on the appeal filed by the company, the Tribunal upheld the preliminary objection of the FIRS against the appeal of Multichoice Africa Holdings B.V, and stated that the South African company did not comply with Order 3 Rule 6 of the Tax Appeal Tribunal (Procedure) Rules, 2021, according to report.

The Order requires that an appellant is to deposit half of the assessed amount it is disputing before it can be heard on appeal.

Besidesn depositing the sum, the appellant is required to file along with its appeal an affidavit verifying the payment which the company also failed to comply with.

According to the Tribunal, the sum is to be paid as a security for the hearing of any tax appeal.

The rule states that “for an appeal against the tax authority, the aggrieved person will pay 50 per cent of the disputed amount into designated account by the Tribunal before hearing as security for prosecuting the appeal.”

Earlier, FIRS had served a notice of unpaid VAT on Multichoice Africa Holdings B.V. but the company ingenuously challenged the assessment and filed an appeal at the tribunal.

It also failed to comply with provisions of tax laws by refusing to make the required deposit as stipulated by the Tribunal Rules in Nigeria.

It is recalled that the FIRS served Multichoice Africa Holdings B.V. a notice of assessment of unpaid VAT June 16, 2021.

The South African company, however, appealed the assessment at the Tax Appeal Tribunal on the ground of being too excessive for it to pay.

Multichoice Africa Holdings, the parent company of Multichoice Nigeria, though providing services to its Nigerian arm, reportedly did not pay VAT since inception of business operations in the country.

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