The Tax Appeal Tribunal has given a judgment in the case of DANGOTE INDUSTRIES LIMITED-APPELLANT AND FEDERAL INLAND REVENUE SERVICE-.RESPONDENT
FACT OF THE CASE
The Respondent wrote to the Appellant on June 13, 2017, informing the Appellant that a team of tax auditors had been formed to conduct an audit 6iercise on the Appellant’s records. The Appellant, on the other hand, responded with a letter dated June 20, 2017, requesting an extension of the audit’s start date until the last week of July 2017.
After the field audit, the Respondent wrote to the appellant with the subject line “Tax Audit Exercise (2013-2015): Letter of Intention to Raise Assessment” by letter dated March 2, 2018, in the sum of NGN10,982,876,078.00 in additional taxes.
ISSUES FOR DETERMINATION AND TAX RULINGS
1. Whether the Respondent infringed on the Appellant’s right to a fair hearing by issuing a Revised Assessment for CIT, EDT, WHT, and VATsimultaneously with a Notice of Refusal to amend without giving it the opportunity to object to the same, contrary to the provisions of Section 69 of
”The TAT ruled that the Appellant was given ample opportunities to contradict the Respondent’s assessments and should not be heard to complain about a fair hearing”
2. Whether the Respondent did not act illegally and unlawfully when it assessed the Appellant to CIT, WHT, and VAT in the sum of #10,9B as payment of outstanding tax for the 2013-2015 years of account.
” The TAT rules that as a result, we believe that the Respondent did not act illegally or unlawfully when it assessed the Appellant to CIT, WHT, and VAT in the amount of NGN10,982,876,078.00 as outstanding tax liabilities for the fiscal years 2013-2015”
3. Whether the Respondent acted wrongly when it computed VAT in the sum of NGN283,787,474 on Reimbursable Expenses including salaries and rent reimbursed, VAT on Bank Charges made to the Appellant vendors, and VAT on already paid VAT by the Appellant for 2015 in the sum of NGN1,854,794.91
”The TAT rules that Only management fees should be subject to VAT, not the reimbursement of expenses like salaries, rent, and bank charges paid by the subsidiaries on behalf of DIL and recharged to the Company.”
4. Whether Section 19 of CITA applies to the Appellant’s Pioneer Profits and Franked Investment Income
”dividend re-distribution consisting of franked investment income and dividends received from pioneer companies were exempt from EDT, but the Appellant is to make available all the below documents to prove its claim
1) Letter of approval of Pioneer Status by Dangote Cement Plc and Vectiva
2) Pioneer Certificate
3) Production Day Certificate
4) List of Schedule of Pioneer Products.