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Nigerian govt. moves against MultiChoice over tax debt

The Federal Government of Nigeria said it has started making moves to freeze the bank accounts of Pay-TV operator, MultiChoice due to its huge unpaid tax amounting to N1.8 trillion.

The country’s tax agency, Federal Inland Revenue Service (FIRS) claimed it has hired banks to act as agents in freezing and recovering the sum from MultiChoice Nigeria Limited (MCN) and MultiChoice Africa Limited (MCA) accounts (MCA).

According to a statement released by a Director in the agency’s Communications and Liaison Department, Abdullahi Ahmad, the enterprises consistently violated all agreements and obligations.

“The corporations would not swiftly react to correspondences,” FIRS chairman Muhammad Nami was quoted as saying in the release. They lacked data integrity and were opaque, denying FIRS access to their information on a regular basis.

“MCN, in particular, has evaded providing accurate information to the FIRS on the number of its users and revenue. The companies are involved in under-remittance of taxes, necessitating a thorough examination of the company’s tax compliance level.”

According to the FIRS, the groups’ performance did not reflect their tax responsibilities or degree of compliance in the country.

The FIRS further stated that Multi-Choice Africa (MCA), the parent business of MCN, had been non-compliant since its establishment and that the parent company, which provided services to MCN, had not paid Value Added Tax (VAT) since its creation.

“The FIRS is frustrated and infuriated by the issue of tax collection in Nigeria, particularly by foreign-based companies conducting businesses in Nigeria and reaping large profits,” it stated.

“Unfortunately, companies come to Nigeria solely to violate our tax laws by engaging in tax avoidance. There’s no denying that the broadcasting, telecommunications, and cable-satellite businesses have transformed Nigerian communication. However, some businesses are found deficient when it comes to tax compliance. They do things in Nigeria that they wouldn’t dare to try in their home countries.”

According to the FIRS chairman, Muhammad Nami, Nigeria generated 34% of the Multi-Choice group’s overall earnings.

Other African countries where they have a presence, he claims, account for 45 percent of the group’s overall revenue.

“Information now available to FIRS has revealed a tax liability of $1.8 trillion and $342.5 million for relevant assessment years. Section 49 of the Companies Income Tax Act, Cap C21 LFN 2004, as amended, Section 41 of the Value Added Tax Act, Cap V1 LFN 2004, as amended, and Section 31 of the FIRS (Establishment) Act, No. 13 of 2007,” Nami explained.

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