Tax authorities begin probe into people named in Panama Papers

The Tax Compliance Unit is investigating an unspecified number of individuals in relation to the Panama Papers leak, with the tax authorities refusing to reveal how many people are under investigation for tax evasion and money laundering. 

The finance ministry told MaltaToday that investigations are underway but when asked how many individuals or companies are being investigated, the spokesperson said the tax authorities are withholding further information even from the ministry itself.

“The commissioner has informed us that under the law he is not bound to reveal information to anyone, including the ministry, about who is being investigated or how many people are under investigation,” the ministry said. 

Last month, finance minister Edward Scicluna told MaltaToday that he had instructed both the tax authorities and the Financial Intelligence Analysis Unit (FIAU) to request the data directly from the International Consortium of Investigative Journalists (ICIJ) who revealed that 714 companies linked to Malta are listed on the Panama Papers database. 

The leaked data show companies set up by the Panamanian law firm Mossack Fonseca, which specialises in offshore companies in tax havens. 

However, the ICIJ have so far refused to release the offshore data to government agencies.

Tax authorities from various countries are trying to obtain the information from the consortium, however even journalists who have the information are not authorised to pass it on to the tax authorities. 

Minister without portfolio Konrad Mizzi, the Prime Minister’s chief of staff Keith Schembri, his business associate Malcolm Scerri, former Nationalist energy minister Ninu Zammit, former Allied Newspapers managing director Adrian Hillman, Redmap Construction’s Pierre Sladden and Farsons chairman Louis Farrugia are among the Maltese individuals whose name appeared in the ICIJ database.

Scicluna had also said that tax authorities were mulling the idea of creating a specific tax unit to investigate whether individuals and companies named in the Panama Papers leak are involved in money laundering and tax evasion. 

However, the ministry told MaltaToday that there is no need for a special unit since the Tax Compliance Unit “is well equipped to carry out tax investigations.” The TCU works hand in hand with the International Tax Unit (the competent authority in international tax information exchange) which has the authority to request information from other jurisdictions which are party to tax information agreements.

Asked whether there has been any outcome from the investigations, the ministry said cross border cases require a minimum of six months to conclude.