[2013]DLSC17784 • March 16, 2013 • Supreme Court •
MULTICHOICE GHANA LTD vs. INTERNALREVENUESERVICE
Multichoice Ghana Ltd, a pay television company, earned subscription fees from customers and deposited these revenues in an interest-yielding account between 1994 and 1999. The company reported losses in its financial statements by aggregating income from its television business and interest earned, then deducting expenses wholly and exclusively incurred in the television business. The Internal Revenue Service challenged this method, arguing that expenses related to the television business could not be deducted from interest income, and assessed tax separately on the two income sources.
read moreJUDGMENT GEORGINA WOOD CJ The action which triggered this appeal is described as a "friendly action", instituted in the joint interest of the two parties for a judicial pronouncement on a tax regimen that is said to have been in practice in our jurisdiction for a long time without challenge from the business community, the people most affected by it. It is in this light that the plaintiff-appellant company, Multichoice Ghana Ltd (hereafter referred to as the plaintiff) described it, more or less in public interest litigation terms, as having purposely been instituted "for the development of the tax law" as it stood at the date the cause of action accrued. For the material period, the substantive law, which both parties were agreed governed the action and which the parties therefore relied on in support of their respective cases, is the Income Tax Decree, 1975 (SMCD 5), as amended by the Income Tax (Amendment) Law, 1983 (PNDCL 61). By the time the trial court came to deliver it...