Tax dispute: MultiChoice reach agreement to pay FIRS $37.3m

MultiChoice, an entertainment platform which offers products and services, including DStv, GOtv, Showmax, M-Net, SuperSport, amongst others across sub-Saharan Africa, said its subsidiaries have reached a settlement with the Federal Inland Revenue Service (FIRS) and agreed to pay a total tax amount of about $37.3 million.

In a statement on Thursday, the group said the total tax amount of N35.4 billion   to be paid by MultiChoice Nigeria and MultiChoice Africa Holdings will be offset against the security deposits and good faith payments made to date.

Recall that FIRS froze MultiChoice Nigeria’s accounts in 2022 and served Notices of Assessment and Demand Notices on MultiChoice Group with a N1.8 trillion ($1.27 billion) tax claim for its Nigeria operation and a $342 million claim for value-added taxes.

MultiChoice went to court to challenge the penalty imposed by the tax authority, which said the owner of the DSTV service skipped taxes and denied auditors access to its servers.

However, both parties settled for an amicable resolution of their issues and agreed to an out-of-court settlement of their pending tax disputes.

Subsequently, the South African company withdrew all pending lawsuits and the Federal Inland Revenue Service agreed to conduct a forensic audit of MultiChoice’s accounts to determine the company’s tax liability.