Home Business FG to freeze Multichoice bank accounts over N1.8trn tax default
FG to freeze Multichoice bank accounts over N1.8trn tax default
Nigeria's Federal Inland Revenue Service (FIRS) is making moves to freeze and recover the sum of N1.8 trillion from bank accounts belonging to MultiChoice Nigeria Limited And MultiChoice Africa.
In a statement issued by Abdullahi Ahmad, Director, Communications and Liaison Department of the FIRS in Abuja on Thursday, obtained by News Agency of Nigeria (NAN), the move was as a result of the groups' continued refusal to grant FIRS access to their servers for audit.
FIRS added that the companies persistently breached all agreements and undertakings with the Service.
"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.
"The companies are involved in the under-remittance of taxes which necessitated a critical review of the tax-compliance level of the company," the platform quoting Muhammad Nami, the Executive Chairman FIRS.
It noted that Multi-Choice Africa (MCA), the parent Company MCN which provided services to MCN since its inception has not been complying with the country's tax regulations, in clear terms default the payment of Value Added Tax (VAT).
"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 FIRS.
"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," Nami said.
Nigeria is a huge contributor to the purse of the Multi-Choice group up to 34 percent and the next is Kenya with 11 per cent and Zambia in third place with 10 per cent, while the rest African countries where they have presence account for 45 per cent of the group's total revenue, the Chairman revealed.
"Information currently at the disposal of FIRS has revealed a tax liability for relevant years of assessment for ₦1.8 trillion and 342.5 million dollars.
"FIRS is empowered in Section 49 of the Companies Income Tax Act Cap C21 LFN 2004 as amended, Section 41 of the Value Added Tax Act Cap V1 LFN 2004 as amended and Section 31 of the FIRS (Establishment) Act No. 13 of 2007.
"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.
"This should be done before the execution of any transaction involving the companies or any of their subsidiaries. It is further requested that the FIRS be informed of any transactions before execution on the account, especially transfers of funds to any of their subsidiaries.
"It is important that Nigeria puts a stop to all tax frauds that had been going on for too long and all companies must be held accountable and made to pay their fair share of relevant taxes including back duty taxes owed especially VAT," he said.
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