Taxes & Tariffs | |
Taxes & Tariffs | |
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Thursday,
July 11, 2019 / 04:00PM / Deloitte / Header Image Credit: NutraIngredients-USA
The Court of Appeal (CoA), on 24 June 2019, upheld
the decision of the Federal High Court (FHC), in the case between Vodacom
Business Nigeria Limited (‘Vodacom’ or ‘Appellant’) and Federal Inland Revenue
Service (‘FIRS’ or ‘Respondent’). The key issue for determination was whether
value-added tax (VAT) should apply on services rendered outside the shores of
Nigeria by a non-resident company (NRC) to a Nigerian company.
The CoA, after
considering the arguments of both parties, held that the supply of satellite
bandwidth capacities to Vodacom by New Skies Satellites (NSS), a
Netherlands-based company, is liable to VAT, irrespective of whether the NRC
included VAT on its invoice or whether it was physically present in Nigeria to
render the services.
Therefore, Vodacom
was required to account for the VAT on the transaction and remit same to FIRS.
The following issues
were considered and resolved by CoA:
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