MultiChoice Settles $37 Million Tax Dispute with Nigeria

MultiChoice Settles $37 Million Tax Dispute with Nigeria

Pan-African broadcaster MultiChoice has reached a resolution with Nigeria’s Federal Inland Revenue Services (FIRS) over a tax case that dates back to 2021. The company will pay ₦35 billion (approximately $37 million) to settle the three-year dispute, which initially involved accusations of a ₦1.8 trillion ($4.4 billion) tax fraud.

In June 2021, FIRS accused MultiChoice of tax fraud, prompting the freezing of the company’s bank accounts. Despite consistently asserting its innocence, MultiChoice has agreed to pay the substantial amount to bring the matter to a close. The payment will be distributed between MultiChoice Nigeria and MultiChoice Africa, totaling ₦35.4 billion.

In a statement to shareholders, MultiChoice expressed that the payment would be offset against security deposits and good faith payments made to date, bringing the total amount paid by the broadcasting giant to $56 million. Despite this significant sum, MultiChoice has consistently maintained its innocence throughout the process.

The dispute took a legal turn when MultiChoice filed an appeal in August 2021, challenging the initial ₦1.8 trillion tax bill with the Tax Appeal Tribunal. The tribunal later ruled that MultiChoice should pay half the amount and imposed a $19 million deposit.

By March 2022, both MultiChoice and FIRS opted for an amicable resolution, leading to the withdrawal of existing lawsuits. During this period, FIRS conducted a forensic audit to accurately determine MultiChoice’s tax liability.

This settlement marks the end of a prolonged legal battle between MultiChoice and Nigerian tax authorities. Despite the significant financial impact on MultiChoice, the broadcasting giant remains firm in its stance that it did not engage in any wrongdoing. The resolution allows MultiChoice to put the tax dispute behind it and focus on its core operations in the dynamic African broadcasting landscape.

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