South African company and leading pay TV service provider in Nigeria, MultiChoice, has prepared grounds to appeal a $4.4 billion tax claim by the Federal Inland Revenue Service (FIRS).
The company stated on Wednesday that its Nigerian unit had obtained clearance from a tax tribunal to proceed and institute the appeal after paying a $19.4m deposit.
MultiChoice, operators of DSTV, GOTV and ShowMax, and Africa’s biggest pay TV provider, felt the tribunal’s clearance as a reprieve.
The FIRS, the federal revenue agency, had maintained in August that MultiChoice would have to pay half of the disputed $4.4bn claim, which comes up to about $2.2bn, to argue its case.
Following its expression of intention to appeal the tax claim, the company’s share value has since recovered to near three-month highs after it temporary tumbled in the immediate aftermath of the tax liability saga.
MultiChoice is challenging the penalty imposed by the FIRS but the federal agency is insisting that the company failed to pay taxes for years even as it denied auditors access to its servers.
Analysts noted that $4.4bn claim was higher than the company’s market value of about $3.8bn.
