Konrad Mizzi: ‘I will not resign’

Energy and health minister Konrad Mizzi has declared he will not resign his Cabinet position after declaring having set up an offshore company in Panama, that is owned by a firm of trustees who will invest his family’s wealth in an offshore trust in New Zealand.

In documents shown to MaltaToday, Mizzi has declared that he is the ultimate beneficial owner of the Panamanian firm Hearnville Inc. – a company incorporated by the Mossack Fonseca firm of Panama – whose shareholders today are the Orion Trust Limited of New Zealand, which are appointed as trustees of the Mizzi family’s Rotorua Trust in New Zealand.

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Mizzi also procured three statements, dated 26 February 2016, from ATC Administrators, which certified having held Hearnville’s shares before transferring them to Orion Trust in July 2015; from Orion Trust saying that it owns 100% of Hearnville’s shares, that neither Orion Trust or Rotorua hold any bank accounts as yet, and that Hearnville has never traded to date and has no assets or bank accounts opened in its name.

“Everything I’m doing is legal, it’s a perfectly legitimate structure,” Mizzi said, who refuted suggestions that he employed a structure that guarantees him full banking secrecy and the ability to collect payments without being obliged to declare the source of this income, while paying no tax on any money held in an offshore trust.

Mizzi pledged to declare every change in his financial set-up within the parliamentary declaration of assets, and said he will submit himself to an annual audit by the Commissioner of Inland Revenue in order to keep everything above board.

He insisted that his wealth, as declared in the 2014 parliamentary declaration, was the money he would invest in his offshore company; but did not state explicitly the full extent of the wealth his wife Sai Mizzi Liang – a consul for Malta in Shanghai – acquired before her marriage to him.

He denied using the Panama-New Zealand offshore centres to avoid paying tax on the full value of his asset base or the investments he will realise in future, and said he would pay full tax on any earnings he declares in Malta.

He also denied suggestions that his Panama company enabled him to receive incomes whose sources he did not need to disclose, an untenable position for him as a minister who takes decisions on multi-million projects such as the Electrogas plant.

“I have been transparent… you’ve seen the names of the trustees. I refute all allegations. [PN leader] Simon Busuttil has alleged that millions are in this bank account. There isn’t one penny.”

Mizzi has insisted that he has been up-front by declaring the structure of his offshore company and trust, and denied suggestions that he was being fiscally immoral for trying to minimise his tax exposure. “It’s a long-term lifetime set-up. It is the right thing to do,” Mizzi said, saying his earnings were sitting in a bank account accumulating just 1% in interest.

“I’m not avoiding tax, I’m not avoiding any laws. [UK prime minister] David Cameron’s family trust has utilised Panama as well,” Mizzi said with reference to a £25 million fund Cameron’s father left in Panama after his death.

Mizzi refused charges that his offshore set-up jarred with his social democrat pedigree, and said he would not close down the trust set-up to be above suspicion.