'Tax evasion': Tribunal okays Multichoice's N8bn deposit, fixes date to hear appeal against FIRS

‘Tax evasion’: Tribunal okays Multichoice’s N8bn deposit, fixes date to hear appeal against FIRS

October 20

16:17 2021

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The tax appeal tribunal (TAT) has ruled that Multichoice Nigeria Limited met the conditions necessary to prosecute an appeal against the N1.8 trillion tax levied on it by the Federal Inland Revenue Service (FIRS).

Multichoice is the owner of the satellite televisions, DStv and Gotv – popular subscription-based platforms in Nigeria.

At the hearing in Lagos on Wednesday, the administrative court said it was satisfied that MultiChoice had complied with the directive by depositing N8 billion — as instructed on the provision of the FIRS Act.

Paragraph 15(7)(c) of the fifth schedule of the FIRS Act, 2007 requires an appellant to pay 50 percent of the tax paid the previous year plus 10 percent mark-up as security before prosecuting an appeal.

At the last hearing in September, the FIRS had asked the tribunal to discontinue the hearing of MultiChoice’s appeal and enter judgment against the appellant for failure to pay 50 percent of the disputed N1.8 trillion sum under assessment — about N900 billion.

But Multichoice Nigeria Limited said it had complied with the directives of the tax tribunal by depositing an amount required by the law with the FIRS, which according to the company, is N8 billion.

Both parties had expressed diverse views on the amount expected to pay as security for prosecuting an appeal before the TAT — as stakeholders, including PricewaterhouseCoopers (PwC), faulted loopholes in the FIRS Act.

Reading the ruling, AB Ahmad, the tribunal chairman, dismissed the contention of the FIRS that the deposit made by MultiChoice amounted to non-compliance with Paragraph 15(7) of the FIRS Act.

He said the appellant has shown respect to and complied with the tribunal’s directive.

The tribunal also dismissed the argument of the FIRS that the security deposit MultiChoice was required to make should cover 10 consecutive financial years — not just that of the preceding financial year, which is 2019.

The tribunal agreed with the position of MultiChoice that the relevant provision of the FIRS Act stated the preceding year and not years — as the FIRS had argued.

The tribunal then fixed November 17, 2021, for the commencement of the hearing of the appeal.