MultiChoice: “Tax claims are overstated”

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MultiChoice, the South Africa based pay-TV operator, insists that it doesn’t have to pay the 50 per cent of the overall $4.34 billion back tax claimed by Nigeria’s Federal Inland Revenue Service (FIRS) for its pay-TV activities in Nigeria.

MultiChoice, in a statement, said it believes the actual amount due is “substantially” less than the amount claimed. The snag is that Nigeria’s rules mean that the 50 per cent must be paid ahead of any potential appeal can be mounted.

“The direction issued by the tax appeal tribunal (TAT) does not compel MultiChoice Nigeria to make payment of 50 per cent of ₦1.8-trillion, being half of the disputed tax assessment, which is under appeal,” MultiChoice Group said in a statement to shareholders on August.

“The direction issued by the TAT […] requires MultiChoice Nigeria to deposit with the FIRS an amount equal to the tax paid by MultiChoice Nigeria in the preceding year of assessment or (MultiChoice’s emphasis) one half of the disputed tax assessment under appeal, whichever is the lesser amount plus 10 percent,” MultiChoice added, stressing “The lesser amount is the tax paid by MultiChoice Nigeria in the previous assessed year, which is substantially less than the disputed assessment.”

MultiChoice said it was a law-abiding company and continued to engage constructively with FIRS in an attempt to resolve the matter.

The case is currently adjourned until September 23rd.


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