Reps to probe Multichoice of alleged N1.8tn, $342m tax fraud

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The House of Representatives has mandated its Committee on Finance to investigate the alleged non-remittance of tax revenue by a South African entertainment company, Multichoice Group.

The resolution of the House was a sequel to the adoption of a motion titled, “Need to investigate the alleged unremitted N1.8tn and $342m tax revenues owed the Federation by Multichoice Group.”

Invited to lead the debate on the general principles of the motion, the sponsor and member representing Bida/Gbako/Katcha Federal Constituency, Niger State, Saidu Abdullahi, said the power of the House to probe Multichoice is derived from Sections 88 and 89 of the 1999 Constitutions (as amended).

Abdullahi noted that Multichoice, “A prominent multinational corporation operating in Nigeria, has been accused of non-remittance of tax revenues due to the Federation, as evidenced by the suppression of information discovered from the submissions in their home country.”

Cognizant that the Federal Inland Revenue Service had engaged a consultant in 2021 under a Whistleblowing contract to carry out an audit of the tax obligations of Multichoice Nigeria and MultiChoice Africa to ascertain the company’s tax indebtedness to the country, the lawmaker said that their findings led to a back audit and investigation carried out by the FIRS from 2011 to 2020.

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The House, “Cognizant of the previous attempts by FIRS to recover the unpaid taxes through legal means; including court proceedings and the subsequent resolution to settle out of the court by both parties has not yielded the desired result,

“Observes that the systems audit and investigation revealed enormous indebtedness to the tune of over N1.8 tn in back total taxes for MultiChoice Nigeria, and $342m in Value-added tax, for MultiChoice Africa that had never paid any taxes since they started business operations in Nigeria. Both amounts were levied upon the Multichoice Group by the FIRS,” he added.

That said, Abdullahi alleged that “there are ongoing arrangements to sell Multichoice Nigeria and Multichoice Group subsidiaries in Nigeria to a foreign interest, while tax indebtedness is outstanding.”

According to Abdullahi, “If urgent actions are not taken to recover the tax revenues from the Multichoice Group, Nigeria may lose huge revenue that can inject life into the economy.”

This is just as the House agreed that there is a need to thoroughly investigate the allegations and take appropriate action to safeguard the interests of Nigerians.

Consequently, the House mandated its Committee on Finance to investigate the non-remittance of tax revenues by the company “with a focus on the suppression of information discovered from their submissions in their home country and report back within four weeks for further legislative action.”

The House further cautions potential buyers of Multichoice Nigeria, Multichoice Africa and other subsidiaries of Multichoice Group operating in Nigeria “to be aware of the alleged outstanding indebtedness which may have been covered in their papers.”