Government scraps €40m tax deal with business mogul Charles Polidano – report

The Government, at the 11th hour, went ahead and scrapped a deal negotiated with local construction magnate Charles Polidano – more commonly known as ic-Caqnu, which dealt with repayment of millions of euros owed in taxes, the Times of Malta reports.

The newsroom says that the tax authority has been in talks with Mr Polidano for some months now, with the latter aiming to reduce an eye-watering €40 million tax pill owed to Government.

Last year, the same newsroom revealed that Mr Polidano had concluded an agreement with the Inland Revenue Department to net off outstanding taxes against money the business mogul is owed for public works carried out by his company, Polidano Group, in recent years, as well as land he sold to state entities.

Mr Polidano reportedly planned to pay some €10 million of taxes owed within 12 months of the deal being struck, with a further one-third of the amount owed to be settled via a mixture of monthly instalments and other securities. The agreement would have reportedly also seen Mr Polidano forego money his company is owed for several large-scale public works contracts, with the funds used to continue netting off his tax bill.

The Times says that Malta’s tax authorities were “keen” to conclude on the largest settlement agreement ever completed by the IRD, but that the Government took issue with the terms and put a halt to the deal.

Reports suggest that senior Government officials were not impressed by what was deemed a “low” down payment, and that the terms were too favourable to the contractor.

Taxes owed by Mr Polidano date back to the mid-1990s, and his company, Polidano Group, has been involved in major national infrastructure projects.

One major controversial development which continues to raise eyebrows is Montekristo Estate, in the outskirts of Siggiewi, which has been described as one of the largest illegal developments on the island.

While Polidano Group has been placed on a blacklist by Infrastructure Malta due to taxes owed, which means they cannot be awarded contracts by the national infrastructure agency, other Government agencies continue to award the controversial businessman contracts.