Ebonyi State Governor David Umahi says the state is not in support of Rivers, Lagos and other states in their moves to collect Value Added Tax.
Umahi stated this at a dinner organised in honour of a former Chief of Army Staff and Nigerian Ambassador to the Republic of Benin, Amb. Tukur Buratai, on Monday night.
Umahi said Ebonyi was solidly and would continually throw its weight behind the Federal Inland Revenue Service’s collection of VAT.
Speaking at the dinner held at the Governor’s Lodge, Centenary City, Abakaliki, Umahi reiterated that the state would not support any of the states collecting VAT, adding “Evil will continue to thrive if good people keep quiet.”
He said, “We must make Ebonyi State very exceptional by rising to the challenges. When we shout true federalism, I say, I agree; but it should be administrative restructuring.
“Ebonyi State is not in support of any state collecting VAT. We are in support that FIRS should continue to collect tax and share.”
While urging the country’s leaders to speak up against dissenting voices that were capable of polarising the nation, Umahi stressed he was open to debate with any governor from the stable of the Peoples Democratic Party, who felt he had delivered more democracy dividends to his people than the APC-led administration in Ebonyi State.
“People are taking special interest in Ebonyi State and her Governor, positively and negatively; but it is very important to be in the news than for you to say there are 36 states, you will name 35 and say what is the other state?
“We have aborted it; we are now a state to reckon with and we have no apologies.
“When I say I have no apologies, you can talk everything about me but you can not say we have not delivered and so when people open their mouths in PDP to talk about APC, they should know that I belong to APC and if they like, let PDP offer any of their best Governors to come for debate with me and I will defeat any of them; it’s not just to be talking and talking. You don’t sit on people’s sweat and resources and be talking nonsense.
“We have no regrets taking our people to the centre. We have always played at the centre. We are not playing party politics, we are playing politics that will be an advantage to our people, criticise me; no problems. But we need resources, we need friendship with the centre,” Umahi stated.
A Tax Appeal Tribunal sitting in Lagos on Tuesday ordered Multichoice Nigeria Limited to pay 50 per cent of the N1.8tn which the Federal Inland Revenue Service determined to be the amount the company has evaded in tax payments.
This was disclosed in a statement issued on Wednesday by the Director, Communications and Liaison Department, FIRS, Abdullahi Ahmad.
The statement was titled, “Tax Evasion: Tribunal Orders DSTV To Pay 50% Tax Backlog Before Hearing Appeal”
It read in part, “A Tax Appeal Tribunal (TAT) ordered Multichoice Nigeria Limited, owners of popular cable television services, DSTV, to pay 50 per cent of N1.8 trillion which the Federal Inland Revenue Service (FIRS) has determined through a forensic audit to be the amount in taxes that Multichoice Nigeria Limited had failed to pay to the Government of Nigeria in past assessment years.”
Recall that in July, the FIRS appointed some commercial banks to recover the sum of N1.8tn from Messrs MultiChoice Nigeria Limited and MultiChoice Africa.
The Service noted the appointment was necessitated by the group’s continued refusal to grant FIRS access to its servers for audit, the companies’ persistent breach of agreements and undertakings with the Service, under-remittance of taxes, among other things.
According to the statement, the five-member TAT led by its Chairman, Professor Ahmed, issued the order following an application to it by the Counsel to FIRS.
“The Counsel made the application under Order XI of the TAT Procedure Rules 2010 which requires Multichoice, or any other taxpayer who disputes their tax assessments, to make the statutory deposit required under Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) as a condition that must be fulfilled before the prosecution of the appeal brought before TAT.
“In certain defined circumstances to which the Multichoice appeal fits, Paragraph 15(7) of the Fifth Schedule to the Federal Inland Revenue Service (Establishment) Act 2007 (FIRS Act) requires persons or companies seeking to contest a tax assessment to pay all or a stipulated percentage of the tax assessed before they can be allowed to argue their appeal contesting the assessment at TAT,” the statement added.
The application by the Counsel to the FIRS was in response to a notice of appeal filed by Multichoice.
It read further, “Multichoice Nigeria Limited filed the matter at the Lagos TAT following its dispute over FIRS’ issuance of Notices of Assessment and Demand Note in the sum of N1, 822, 923,909,313.94k on 7 April 2021.
“The amount constitutes what the FIRS calculated as due in taxation to the Federal Government of Nigeria from Multichoice after an investigation over several months to determine the extent to which Multichoice has been evading taxes in Nigeria.
“At Tuesday’s hearing of the matter in Appeal No: TAT/LZ/CIT/062/2021 19/08/2021 (Multichoice Nigeria Limited v. Federal Inland Revenue Service), Multichoice Nigeria Limited amended its Notice of Appeal and thereafter sought through its Counsel, Bidemi Olumide of AO2 Law Firm for an adjournment of the proceedings to enable it to respond to the FIRS’ formal application for accelerated hearing of the appeal and prayer before the TAT to order Multichoice to produce DSTV’s revenue and subscriber database, among other prayers.
After hearing arguments from both sides, TAT upheld the FIRS Act and directed Multichoice Nigeria Limited to deposit with the FIRS the amount prescribed by the law, plus a sum equal to 10 per cent of the said deposit as a condition precedent for further hearing of the appeal.
The tribunal adjourned the Appeal to 23 September for the continuation of the hearing, subject to compliance with its order.
When contacted Multichoice Nigeria refused to comment.
Recall that the company announced the demise of its Chief Customer Officer, Mr Martin Mabutho yesterday.
The boisterous Mabutho died in the early hours of Tuesday, in Cape Town after a brief illness.
Martin Mabutho
“Martin was not just a colleague but a very close friend and most trusted adviser. He was well loved by everyone for his energy and hard-work, his warmth, good humour and the creativity and positive attitude he always brought to the team. He will be greatly missed,” said John Ugbe, CEO, MultiChoice Nigeria.
Mabutho joined MultiChoice Botswana as a Customer Service Supervisor in 1999, and later became a Brand Manager at MNet in 2003. He led the Marketing and Sales effort for DStv Mobile in Sub-Saharan Africa before his appointment as MultiChoice Nigeria’s General Manager, Sales and Marketing in 2013.
He was appointed Chief Customer Officer in 2018, responsible for driving the MultiChoice Nigeria customer group strategy covering customer value management, sales, marketing, customer experience and care.
Aged 47, Mabutho is survived by aged parents, his wife Thato and their four children.
The Federal Inland Revenue Service (FIRS) has appointed some commercial banks as agents to recover N1.8 trillion from accounts of MultiChoice Nigeria Limited (MCN) And MultiChoice Africa (MCA).
Muhammad Nami, FIRS chairman, said the decision to appoint the banks as agents and to freeze the accounts was as a result of the group’s continued refusal to grant FIRS access to its servers for audit.
Multichoice is the owner of the satellite television, DSTV, a popular subscription-based platform in Nigeria.
Nami said the FIRS discovered that the companies persistently breached all agreements and undertakings with the service.
He explained that the companies failed to promptly respond to correspondences, and further described them as lacking in data integrity and transparency 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,” a statement by Abdullahi Ahmad, FIRS director of communications and liaison department, quoted Nami to have said.
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 FIRS chairman said that Nigeria contributes 34 percent of total revenue for the Multi-Choice group, adding that the next to Nigeria from intelligence gathering is Kenya with 11 percent and Zambia in third place with 10 percent.
According to him, the rest of African countries where they have presence, accounts for 45 percent of the group’s total revenue.
“Information currently at the disposal of FIRS has revealed a tax liability for relevant years of assessment for N1.82 trillion and $342.5 million,” he said.
“Under FIRS powers 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, all bankers to MCA & MCN in Nigeria were 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 Federal Inland Revenue Service be informed of any transactions before EXECUTION on the account, especially transfers of funds to any of their subsidiaries.”
Nami noted that it was important that Nigeria puts a stop to all tax frauds that have been going on for too long.
He added that 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.
