In Nigeria, the Tax Appeal Tribunal is reported to have dismissed Multichoice Africa Holdings appeal on the assessment of unpaid Value Added Tax (VAT) amounting to over US$ 123.7 million by the Nigerian Federal Inland Revenue Services due to a lack of diligent prosecution.
While delivering its judgment on Multichoice Africa Holdings B.V.’s appeal, the Tribunal upheld the FIRS’ preliminary objection to the company’s appeal.
According to the Tribunal, Multichoice did not comply with Order 3 Rule 6 of the Tax Appeal Tribunal (Procedure) Rules, 2021, which requires an appellant to pay half of the assessed amount being challenged before being heard on appeal. In addition to depositing the funds, the appellant is obliged to provide an affidavit certifying the payment with its appeal, which the company failed to do.
According to the rule, “for an appeal against the tax authority, the aggrieved party must pay 50 per cent of the disputed amount into a designated account by the Tribunal before hearing as security for prosecuting the appeal.”
Multichoice Africa Holdings B.V. was presented with a notice of unpaid VAT by the FIRS, but the company vigorously opposed the assessment and filed an appeal with the Tribunal. However, it failed to comply with tax rules by refusing to make the required deposit as stipulated by the Tribunal Rules.
On the 16th of June 2021, the FIRS had served Multichoice Africa Holdings B.V. with a notice of assessment of overdue VAT. Multichoice Nigeria’s parent company is thought to have avoided paying VAT from its inception despite providing services to its Nigerian arm. As a result, the corporation filed a Tax Appeal Tribunal appeal, stating that the assessment was excessive.
Multichoice Africa Holdings B.V. is expected to pay US$ 123.7 million in unpaid VAT, plus US$ 218 million in interest and penalty, for a total of nearly US$ 342 million, according to the FIRS.
