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FIRS goes for N1.8tr tax liability from Multichoice coffers

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The Federal Inland Revenue Service (FIRS) yesterday moved to recover N1.8 trillion from the accounts of MultiChoice Nigeria (MCN) Limited and MultiChoice Africa (MCA).

According to the revenue collector, some banks have been appointed to freeze the accounts of the Cable television service providers.

FIRS Director in charge of Communications and Liaison Department Abdullahi Ahmad said in a statement in Abuja that the appointment of banks as accounts freezing agents followed the groups’ refusal to grant the service access to their server for audit.

But MCN said the action taken by the FIRS was unnecessary because it is already in talks with the service.

The N1.8 trillion is said to be the taxes the companies owe Nigeria which contributes 34 per cent of their total revenue in Africa.

FIRS described the level of tax evasion by the two firms as “alarming,” adding that MCA has never paid a kobo to the Federal Government as Value Added Tax (VAT) since it began business in the country.

It also accused MCN of not “ giving accurate information on the number of its subscribers and income” in the country.

FIRS Executive Chairman Muhammad Nami said the decision was taken due to MCN’s persistent breach of agreements and undertakings with the revenue agency.

The FIRS statement was however silent on the number and names of the banks appointed to “sweep balances in each of the above-mentioned entities(MCA and MCN)’ accounts and pay the same in full or part settlement of the companies’ respective tax debts until full recovery.”

The statement reads: “All bankers to MCA and MCN in Nigeria have been appointed as Collecting Agents for the full recovery of the aforesaid tax debt”.

The agency further stated that the agent banks should notify it of “any transactions before execution on the account, especially transfers of funds to any of their subsidiaries.”

Faulting reasons for the FIRS action, MCN said apart from complying with the tax laws of Nigeria, it is in talks with the agency over the issue.

“MultiChoice Nigeria has not received any notification from FIRS. MultiChoice Nigeria respects and is comfortable that it complies with the tax laws of Nigeria. We have been and are currently in discussion with FIRS regarding their concerns and believe that we will be able to resolve the matter amicably,” Bamidele Johnson, spokesman for the cable television service provider said in a terse statement.

It added: “The companies persistently breached all agreements and undertakings with the Service, they would not promptly respond to correspondences, they lack data integrity and are not transparent as they continually deny FIRS access to their records.

“The companies are involved in the under-remittance of taxes which necessitated a critical review of their tax-compliance level.

“The group’s performance does not reflect in its tax obligations and compliance level in Nigeria. The level of non-compliance by MCA, the parent company of MCN is very alarming.”

FIRS lamented that “the issue with tax collection in Nigeria, especially from foreign-based companies conducting businesses in Nigeria and making massive profits is frustrating and infuriating.”

It said: “Regrettably, Companies come into Nigeria just to infringe on our tax laws by indulging in tax evasion. There is no doubt that broadcasting, telecommunications, and the cable-satellite industries have changed the face of communication in Nigeria. However, when it comes to tax compliance, some companies are found wanting. They do with impunity in Nigeria what they dare not try in their countries of origin”.

The statement further confirmed that Nigeria which contributes 34 percent of the total revenue of the Multi-Choice group is followed by Kenya with 11 percent.

Zambia contributes 10 percent while the rest of Africa where the group has presence accounts for 45 percent..

FIRS said apart from the ¦ 1.8 trillion unpaid tax by MCA and MCN, information at its disposal also revealed $342,531,206 tax liability for relevant years.

Faulting reasons for the FIRS action, MCN said apart from complying with the tax laws of Nigeria, it is in talks with the agency over the issue.

“MultiChoice Nigeria has not received any notification from FIRS. MultiChoice Nigeria respects and is comfortable that it complies with the tax laws of Nigeria. We have been and are currently in discussion with FIRS regarding their concerns and believe that we will be able to resolve the matter amicably,” Bamidele Johnson, spokesman for the cable television service provider said in a terse statement.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Oil Prices Continue to Climb on Supply Disruptions As Brent Hits $78/1

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Brent crude futures rose more than 1% to above $78 a barrel on Friday, the highest since October 2018 and widening a weekly gain to 3.6 per cent amid global supply concerns following storms in the US that damaged facilities on the Gulf coast.

WTI crude rose for the fifth consecutive week, with futures up almost 3 per cent to an 8-week high of $73.98 a barrel boosted by growing fuel demand and falling US crude inventories.

Disruptions in US Gulf Coast production following Hurricane Ida and other storms have led to sharp draws in US and global inventories. EIA data showed US crude stocks fell by 3.5 million barrels to 414 million last week, the lowest since October 2018. Capping some gains was China’s first public sale of state oil reserves. State-owned PetroChina and private refiner and chemical producer Hengli Petrochemical bought four cargoes totaling about 4.43 million barrels.

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Buhari: Five million homes to get solar power by 2030

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Nigeria is working on an ambitious energy plan including decentralised solar energy solutions that will substantially reduce the energy shortcomings by the year 2030, President Muhammadu Buhari has said.

The President spoke on the sidelines of the 76th United Nations General Assembly in New York on the High-Level Dialogue on Energy.

Spokesman for the President, Mr Femi Adesina, in a statement Friday night, quoted Buhari as saying, “Nigeria’s commitment to a just transition is reflected in our ambitious Energy Compact, which includes the government’s flagship project to electrify five million households and 20 million people using decentralised solar energy solutions.

“This is a major first step towards closing our energy access deficit by 2030. Nigeria’s commitment is also reflected in the development of our Energy Transition Plan, which was developed with the support of the UK COP26 Energy Transition Council.”

He called for support from developed countries to unlock the financing needed to accelerate a just energy transition for all.

“The focus of our discussions on transition must now evolve how we help countries develop detailed energy transition plans and commitments to mobilize enough financing to empower countries to implement those plans,” he said.

The President said the scale of financing required for Nigeria to achieve net-zero would amount to over $400bn across the Nigerian economy in excess of business-as-usual spending over the next 30 years.

He said, “This breaks down to $155bn net spends on generation capacity, $135bn on transmission and distribution infrastructure, $75bn on buildings, $21bn on industry and $12bn on transport.”

Buhari, however, said that gas would continue to have a big role to play before phasing it out, explaining that solid fuel cooking was still wreaking havoc in Africa:

He said, “As a global leader on the energy transition, it is imperative that I flag a major risk to development that stems from the current narrative around the energy transition, particularly on the role of gas and the lack of financing.

“Nigeria’s Energy Transition Plan has laid out our road map to reach net-zero and highlights the scale of the effort required, which includes the development and integration of renewables into current grid infrastructure at tremendous scale and electrification of all sectors.

“This is challenging for any country, especially a developing country. On our development objectives, gas will have a key role to play here for some years before being phased out.”

President Buhari noted that these plans must also take into account the provision of access to electricity and clean cooking solutions for those in Nigeria and around the world currently without access.

He also stressed the essential role of gas in addressing clean cooking challenges.

“Globally, there are 2.6 billion people who lack access to clean cooking – which is unacceptable. Even more concerning is that solid fuel cooking in Africa causes almost 490,000 premature deaths annually, making it the second-largest health risk in Africa,” he stated.

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States can’t collect VAT, it’s on exclusive list – Malami

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State governments are not empowered to collect value-added tax (VAT) in the country because it is on exclusive legislative list, the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, has said.

The AGF gave this position on Friday night in an interview with Channels Television.

The Federal Inland Revenue Service has been at loggerheads with Rivers and Lagos State governments over VAT collection. And the matter already receiving the backing of some other state governments is current in court.

Malami, who said the collection of VAT in the country is under the exclusive legislative list, posited that only the National Assembly could make laws on VAT.

He said, “A lot has precluded the state from collecting value-added tax. One, generally speaking, as you rightly know, the issue of the value-added tax is an issue on the exclusive legislative list.

“And the implication of being in exclusive legislative list matter is that only the national assembly can legislate on it. The question that you may perhaps wish to address your mind on is whether there exists any national legislation that has conferred the power on the state to collect VAT. And my answer is ‘no’.

“In the absence of a law passed by the national assembly in that direction, no state can have a valid claim to collection of value-added tax.

“The responsibility, right and constitutional powers to legislate on collection of VAT are exclusively and constitutionally vested in the National Assembly and not in the state.

“Where the national assembly has not passed any law in that regard authorising the state to collect VAT, then it goes without saying that no state can arrogate unto itself the powers to collect VAT.”

According to the minister, it will be reckless for any state to go ahead to collect VAT, despite the court’s decision asking parties to maintain the status quo.

He said, “I don’t see any state perhaps taking the law unto its hands without allowing the judicial process to take its natural course and in breach of the prevailing legislation.

“I don’t see the states acting arbitrarily and setting a very bad precedence as far as governance is concerned with particular regard to the fact that the matter is receiving judicial determination.

“I can’t understand. I can’t perhaps bring that thought into consideration that I believe it could amount to a high level of recklessness on the part of any state government to be operating in breach and to be operating a lawless governance style as far as the Nigerian state is concerned.”

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