A Tax Appeal Tribunal in Lagos has ordered Multichoice Nigeria Limited, the owners of DSTV cable television services, to pay the Federal Inland Revenue Service 50% of a N1.8 trillion tax backlog.
Mr Abdullahi Ahmad, Director, FIRS Communications and Liaison Department, announced this in an Abuja statement on Wednesday.
FIRS found the backlog through a forensic examination, which purportedly revealed that Multichoice Nigeria Limited had neglected to pay the Government of Nigeria in previous assessment years, according to Ahmad.
According to him, the five-member TAT, led by its Chairman, Prof. A.B. Ahmed, issued the order in response to a request from the Counsel to FIRS.
He stated that the Counsel filed the application under Order XI of the TAT Procedure Rules 2010, which requires Multichoice or any other taxpayer who disputes their tax assessments to make the statutory deposit required by paragraph 15(7) of the Federal Inland Revenue Service (Establishment) Act 2007. (FIRS Act).
These applicable laws, he claims, are requirements that must be met prior to the TAT's consideration of the appeal.
"Paragraph 15(7) of the fifth schedule to the FIRS (Establishment) Act 2007 requires persons or companies seeking to contest a tax assessment to pay all or a specified percentage of the tax assessed before they can argue their appeal contesting the assessment at TAT in certain defined circumstances, which the Multichoice appeal falls under.
"Following a dispute with FIRS over the issuing of Notices of Assessment and Demand Notes in the amount of N1,822,923,909,313.94k on April 7, 2021, Multichoice Nigeria Limited filed the matter with the Lagos TAT.
"After an examination spanning several months to assess the extent to which Multichoice has been dodging taxes in Nigeria," he added, "the amount represents what the FIRS calculated as payable in taxation to the Federal Government of Nigeria from Multichoice."
Multichoice Nigeria Limited amended its Notice of Appeal at Tuesday's hearing of the matter in Appeal, according to Ahmad, and then sought an adjournment of the proceedings through its counsel, Bidemi Olumide of AO2 Law Firm, to allow it to respond to the FIRS' formal application for accelerated hearing of the appeal.
In response, the FIRS Counsel requested that TAT issue an order ordering Multichoice to deposit 50% of the disputed sum as a statutory deposit.
"After hearing both sides' arguments, the TAT upheld the FIRS Act and ordered Multichoice Nigeria Limited to deposit with the FIRS the amount specified by law, which is equal to the tax imposed on Multichoice in the previous year of assessment.
"Or half of the tax levied by the assessment under appeal (whichever is smaller), plus an amount equal to 10% of the stated deposit as a condition precedent for the Appeal's further hearing."
In response, the FIRS Counsel requested that TAT issue an order ordering Multichoice to deposit 50% of the disputed sum as a statutory deposit.
"After hearing both sides' arguments, the TAT upheld the FIRS Act and ordered Multichoice Nigeria Limited to deposit with the FIRS the amount specified by law, which is equal to the tax imposed on Multichoice in the previous year of assessment.
"Or half of the tax levied by the assessment under appeal (whichever is smaller), plus an amount equal to 10% of the stated deposit as a condition precedent for the Appeal's further hearing."
"Subsequently, the Tribunal adjourned the Appeal until September 23, 2021 for the continuation of the hearing, subject to compliance with the Tribunal's order," he stated.
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