Multichoice Nigeria, a subsidiary of the South African giant and pay-TV operator has had their Nigeria accounts frozen. They are embroiled in a spat with the Nigerian Tax authorities (Nigerian Federal Inland Revenue Services i.e. FIRS) who claim that the pay-tv operator owes them a staggering US$4.3 billion (1.8 trillion Naira) in taxes.
According to a report by Reuters news agency FIRS has instructed Nigerian banks to freeze the accounts of several companies whom they claim have not been complying with their requests to audit their books. They say Multichoice has not been cooperating with them.
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, [MultiChoice Nigeria Limited] has avoided giving the FIRS accurate information on the number of its subscribers and income.A statement made by FIRS
FIRS said Multichoice Africa was several years in areas with its tax. For its part, Multichoice has denied the allegations and expressed surprise about the whole issue. They claim they were not even aware of the FIRS freeze and only saw it in the media.
We have read the media reports and the statements made by the Federal Inland Revenue Service.
MultiChoice Nigeria has not received any notification from FIRS. MultiChoice Nigeria respects and is comfortable that it complies with the tax laws of Nigeria.
…[We] believe that we will be able to resolve the matter amicablyA statement to the media made by Multichoice on the issue.
A while back MTN Nigeria, an affiliate of MTN South Africa, was in a fight with the Nigerian authorities over taxes as well. They were said to be owing about $2 billion by the Nigerian Tax authorities. The claim was later dropped by the country’s law authorities without MTN paying.
Multichoice appear confident that their case will meet a similar fate. They will probably be able to sit down with the government and have the issue resolved. The numbers thrown around in this are rather strange, however. They seem shockingly high for both MTN and Multichoice.
While this might look like a vendetta against South African companies by the Nigerian authorities, it seems more likely this is just a case of an inefficient tax collecting system rather than anything nefarious. As clearly shown from the above statements it’s not just MTN that’s being targeted. They just happen to be the ones that stood out enough to garner headlines.
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