Mizzi did not register New Zealand trust with taxman

Energy minister admits not having registered foreign trust, claiming his advisers were not aware of provision in Income Tax Management Act

Konrad Mizzi
Konrad Mizzi

Energy Minister Konrad Mizzi had admitted on TVM’s Dissett that the New Zealand trust he set up was not registered with the Commissioner of Inland Revenue within 30 days of its setting-up as required by law, claiming his advisers were not aware of the provision.

Mizzi claimed it was the company Nexia BT that advised him to set up his New Zealand Trust and to acquire a Panama company. “Last week I sought more advice and asked lawyers to look at all the laws to make sure I had done nothing wrong. They told me there was a notification, hardly used, in a legal notice.

“We looked for this notification letter on the Inland Revenue’s website but didn’t find anything. We found it in a legal notice but it was an old formula that still used Maltese lira. My advisers didn’t know about it. I told them to rectify it,” he said.

Nationalist MP Tonio Fenech told Parliament on Tuesday that Konrad Mizzi was required at law to inform the Commissioner for Inland Revenue of his New Zealand trust within 30 days of its setting up.

Article 24(B) states that “where the settlor of a trust is a person resident in Malta, and none of the trustees of such trust is a person resident in Malta; and property is settled into such trust… the said settlor shall inform the Commissioner of the property so settled together with a copy, where applicable, of the relevant trust instrument or of any other document evidencing the existence of such trust. This information shall be submitted to the Commissioner by not later than thirty days from the date of the relevant settlement.”

Any settlor who fails to comply is guilty of an offence and liable on conviction to a fine of anything between €116 and €1,160, and to a further fine of €4-€23 for every day during which the offence continues after the lapse of the said thirty days. That would work out to as much as €4,100 in total daily penalties.

MaltaToday filed a Freedom of Information request last week to seek confirmation whether Mizzi’s trust was registered with the CIR as laid down in the Income Tax Management Act.

Speaking during his parliamentary adjournment, the former finance minister said that the law stated that any settlor who fails to provide such details was guilty of an offence under the act.

But Fenech said that Mizzi’s failure to come forward with such a seminal piece of information on his offshore trust. “Had he filed this document, Mizzi would have published it right away. Instead he chose to ask for an investigation from the Commissioner of Inland Revenue. But it doesn’t appear as though Konrad Mizzi notified the Commissioner, which would mean that he would have broken the law.”

Konrad Mizzi has admitted owning a Panamanian firm that is owned by Orion Trust, the trustees of his New Zealand trust Rotorua. Mizzi will be closing down the Panama offshore company.

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