Nigeria has accused pay-TV operator MultiChoice of a 1.8 trillion Naira (€289m) tax fraud.
The allegation says that MultiChoice Nigeria and MultiChoice Africa, which between them operate the DStv pay-TV system in Nigeria (and elsewhere) says that MultiChoice has persistently breached all agreements and undertakings with Nigeria’s Federal Inland Revenue Service (FIRS).
Consequently, FIRS has ordered local banks to freeze the broadcaster’s accounts.
The Executive Chairman of FIRS, Muhammad Nami, said: “The companies would not promptly respond to correspondences, they lacked data integrity and are not transparent as they continually deny FIRS access to their records. Particularly, MCN has avoided giving the FIRS accurate information on the number of its subscribers and income.”
Additionally, FIRS further noted that the level of non-compliance by Multi-Choice Africa (MCA), the parent company MCN was alarming adding that the parent company, which provided services to MCN had never paid Value Added Tax (VAT) since its inception.
“Regrettably, companies come into Nigeria just to infringe on our tax laws by indulging in tax evasion. There is no doubt that broadcasting, telecommunications and the cable-satellite industries have changed the face of communication in Nigeria. However, when it comes to tax compliance, some companies are found wanting. They do with impunity in Nigeria what they dare not try in their countries of origin,” he said.
The chairman stated that Nigeria contributed 34 per cent of total revenue for the MultiChoice group, and the next to Nigeria is Kenya with 11 per cent and Zambia in third place with 10 per cent.
Information on hand at the disposal of FIRS has revealed a tax liability for relevant years of assessment for ₦1.8 trillion and equal to $342.5 million dollars.
“With these relevant sections all bankers to MCA and MCN in Nigeria are therefore appointed as Collecting Agents for the full recovery of the aforesaid tax debt. “In this regard, the affected banks are required to sweep balances in each of the above-mentioned entities’ accounts and pay the same in full or part settlement of the companies’ respective tax debts until full recovery,” states FIRS.