MultiChoice reportedly settles 1.8 trillion Naira tax bill. The media and tech company finally settles a whopping sum of 1.8 trillion Naira tax bill, and in this post, I will be telling you everything you need to know.
MultiChoice Settles 1.8 Trillion Naira Tax Bill
Back in 2021, an investigation into MultiChoice by Nigeria’s taxation authority made headlines, as the company was suspected of evading taxes to the tune of ₦1.8 trillion. Fast forward nearly three years, and there’s been a significant development in this financial drama.
MultiChoice has decided to come to a settlement agreement with the Nigerian Federal Inland Revenue Service (FIRS), consenting to pay ₦35.4 billion, which translates to roughly R475 million. Initially, the FIRS had accused the company of owing a staggering ₦1.8 trillion in overdue taxes, which at the time was equivalent to about R63 billion.
However, as of February 1, 2024, this amount was adjusted down to R37.8 billion and has since further decreased to R24.2 billion, illustrating a tumultuous period for the involved currencies.
The Dispute Traces Back To July 2021
The dispute traces back to July 2021, when the FIRS took the drastic step of freezing MultiChoice’s bank accounts. The tax authority charged that the company had failed to remit Value Added Tax (VAT) payments since beginning operations in Nigeria.
By March 2022, a resolution seemed to be on the horizon when MultiChoice and the FIRS reached a conciliatory agreement. In an effort to end their legal confrontations, MultiChoice consented to a Forensic Systems Audit. This audit was intended to accurately determine the amount of tax owed by the company, with expectations for a swift conclusion.
The Complexities and Challenges of Tax Compliance and Enforcement within Nigeria
This tax saga showcases the complexities and challenges of tax compliance and enforcement within Nigeria’s rapidly evolving digital and entertainment sectors. It also highlights the government’s increasing vigilance in tax collection efforts and the willingness of corporations to negotiate and comply to avoid protracted legal disputes.
The settlement reached by MultiChoice and the FIRS not only concludes a lengthy period of financial uncertainty for both parties but also sets a precedent for how tax-related matters might be resolved in the future in Nigeria’s dynamic economic landscape.
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