Nigerian authorities have ordered the MultiChoice Group to settle half of a multi-billion US dollar tax bill before a tribunal in that country can hear the SA pay-television provider’s appeal.
The Federal Inland Revenue Service (FIRS) has announced that a Nigerian tax tribunal ordered the MultiChoice Group to pay half (US$ 2.19 billion) of a disputed US$4.3 billion tax bill relating to previous years.
MultiChoice Nigeria was ordered to deposit 50 percent of the total amount before the tribunal could hear a full appeal on the matter.
In July FIRS announced it had ordered Nigerian banks to suspend MultiChoice’s accounts because it said the company was refusing to provide tax auditors access to its servers.
At the time, FIRS Chairman Muhammad Nami stated that banks would be responsible for recovering the US$4.3 billion that the tax service claimed was due.
The tax tribunal, says it will hear the matter on 23 September – that is if MultiChoice settles half the tax bill as ordered.
MultiChoice is the latest South African company with a strong presence in Nigeria to be hit with a multibillion-dollar tax demand.
After a long battle that investors alleged had tarnished Nigeria’s reputation as an investment destination,.
Last year Nigeria authorities tried to force MTN to settle a disputed $2bn tax bill. The matter was taken to Nigeria’s attorney general, who cancelled the demand.
Shoprite, which opened its first store in Nigeria in December 2005 and has 26 stores across eight states, pulled out of that country amid concerns over profit repatriation.