Tax Battle: Multichoice Africa Loses Tax Appeal to FIRS

The fierce tax battle between Multichoice Africa Holdings B.V., the parent company of Multichoice Nigeria and the Federal Inland Revenue Services (FIRS) has finally been struck out by the Tax Appeal Tribunal.

The Tax Appeal Tribunal struck out the appeal instituted by Multichoice Africa Holdings B.V against the Federal  Inland Revenue Services (FIRS) over the $342 Million disputed tax. Multichoice engaged FIRS over the assessment of the company’s unpaid Value Added Tax (VAT).

The Tribunal while delivering its judgment on the appeal filed by Multichoice upheld the preliminary objection of the FIRS against the appeal of Multichoice and said the South African company did not comply with Order 3 Rule 6 of the Tax Appeal Tribunal (Procedure) Rules, 2021, which requires that an appellant is to deposit half of the assessed amount it is disputing before it can be heard on appeal. In addition to depositing the sum, the appellant is required to file along with its appeal an affidavit verifying the payment, Multichoice Africa also failed to comply with this.

FIRS served Multichoice Africa Holdings B.V a notice of assessment of unpaid VAT on the 16th of June 2021, FIRS claimed that although the company provided services to its Nigerian arm, Multichoice Nigeria, it had not paid VAT since inception.

Mutichoice is not the first South African company to have a battle with the FIRS, MTN has had its squirmishes with Nigerian authorities in the past. The federal government had said the multinational telecoms firm owed taxes from 2007 to 2017. The case was referred to FIRS with a view to settling the case amicably.

Earlier in August, the telecommunications services provider announced plans to reconstruct the Enugu-Onitsha expressway under the road infrastructure tax credit (RITC) scheme.

The Road Infrastructure tax credit scheme is a public-private partnership (PPP) intervention that grants income tax credit to companies and individuals that provide funding for the refurbishment and rehabilitation of roads.