Nigeria's Federal High Court (the Court) upheld the judgment of the Lagos Division of the Tax Appeal Tribunal (the TAT or the Tribunal) on December 19, 2017, in the case of Vodacom Business Nigeria Limited (VBNL or the Appellant) vs. Federal Inland Revenue Service (FIRS), regarding the imposition of value added tax (VAT) on services rendered by a nonresident Company (NRC) to the Appellant. The Tribunal had, on February 12, 2016, in an appeal by VBNL on the assessment made by the FIRS for the payment of VAT on services received from New Skies Satellite (NSS), held that the transaction between VBNL and NSS for the provision of bandwidth services, was subject to VAT and as such, VBNL was liable to pay the VAT due on the transaction (the TAT judgment). The key implication of the Court's judgment is that the determination of whether VAT is applicable on the invoice issued by an NRC is if there is a supply of goods or services for consideration in line with Section 2 of the VAT Act and not necessarily where the service was rendered or whether the provider of the service is required to register under Section 10 of the Vat Act.

An Indirect Tax Services group Alert, attached below, provides additional details.

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ATTACHMENT

Full text of Tax Alert 2018-0336