Breaking: FIRS Freezes Multichoice Accounts Over N1.8 Trillion Taxes

The FIRS has appointed some commercial banks as agents to recover the sum of N1.8 trillion from accounts of MultiChoice Nigeria Limited (MCN) And MultiChoice Africa (MCA), it was disclosed on Thursday.

The Executive Chairman of FIRS, Muhammad Nami, in a statement made available to  GreenWhiteGreen GWG alleged serial breaches of tax evasion by the group, a development he said had been worsened by the companies’ refusal to allow his officials to examine the books of the group.

MultiChoice makes 34% of its revenues from Nigeria but it is feared that its tax obligations are paltry, the FIRS said.

MultiChoice operates the most dominant DSTV platform in the country with a monopoly over many popular league games, particularly the English Premier League.

“Particularly, MCN has avoided giving the FIRS accurate information on the number of its subscribers and income,” the FIRS said.

“The companies are involved in the under-remittance of taxes which necessitated a critical review of the tax-compliance level of the company.

The statement added that the group’s performance does not reflect in its tax obligations and compliance level in Nigeria. The level of non-compliance by Multi-Choice Africa (MCA), the parent Company of Multi-Choice Nigeria (MCN) is very alarming. The parent company, which provides services to MCN has never paid Value Added Tax (VAT) since its inception.

“The issue with Tax collection in Nigeria, especially from foreign-based Companies conducting businesses in Nigeria and making massive profits is frustrating and infuriating to the Federal Inland Revenue Service (FIRS),” the statement deposed.

“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.

The statement further confirmed that Nigeria contributes 34% of total revenue for the MultiChoice group. The next to Nigeria from intelligence gathering is Kenya with 11%, and Zambia is in 3rd place with 10%. The rest of Africa where they have presence accounts for 45% of the group’s total revenue.

Information currently at the disposal of FIRS has revealed a tax liability for relevant years of assessment for ₦1,822,923,909,313.94 (One trillion, eight hundred and twenty-two billion, nine hundred and twenty-three million, nine hundred and nine thousand, three hundred and thirteen naira, ninety-four kobo only) and $342,531,206 (Three hundred and forty-two million, five hundred and thirty-one thousand, two hundred and six dollars only).

In this regard, the affected banks are required to sweep balances in the accounts of MultiChoice and pay the same in full or part settlement of the companies’ respective tax debts until FULL recovery. This should be done before the execution of any transaction involving the companies or any of their subsidiaries. It is further requested that the Federal Inland Revenue Service be informed of any transactions before EXECUTION on the account, especially transfers of funds to any of their subsidiaries.

The Executive Chairman, FIRS concluded that it is important that Nigeria puts a stop to all tax frauds that have been going on for too long.  All Companies must be held accountable and made to pay their fair share of relevant taxes including back duty taxes owed, especially VAT for which they are ordinarily agents of collection.

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