Global press tracks down taxpayers abroad, but finserv institute says ‘no secrets in Malta Files’

Malta’s financial services community is insisting that the Malta Files has revealed “no secrets” despite having lifted the lid on various ultimate beneficial owners of Maltese holding companies, that were hidden behind nominee companies.

The Institute of Financial Services Practitioners dubbed the European Investigative Collaborations (EIC) project – of which MaltaToday is its Maltese partner – “sensationalist”, and insisted that practitioners operate within a legal and regulatory framework of the highest standards.

“Malta is a full member of the European Union and all its laws, including anti-money laundering rules, are fully aligned with European rules and best practice,” the IFSP said.

Various reports in the EIC uncovered the interests of countless Brazilian, Portuguese, Italian, German, French and Turkish nationals – respectively published in The Intercept, Expresso, L’Espresso, Der Spiegel, Mediapart and Le Soir, and BlackSea.eu – who are paying taxes in Malta to benefit from the unique imputation system, which grants a rebate of some 85% on taxes paid on foreign income.

Much of this was possible by rendering the Maltese company registry searchable, so that individual nationalities of shareholders could be extracted and allow journalists to have the full picture on which multinational or taxpayer was using Malta’s taxation system.

A case in point is the family enterprise of Turkey’s Transport and Maritime Minister, Binali Yıldırım, where the Malta files reveals that the family currently sits on shipping and related assets of well over €100 million, which consists of eleven foreign-flagged ships nestled in a network of secretive companies in Malta, the Netherlands, and the Netherlands Antilles.

The IFSP defended Malta’s taxation policy as a matter of member state sovereignty. “Malta has pro-actively ensured that its tax rules continue to be compliant with applicable EU legal principles. Its laws apply transparently to all Maltese incorporated companies, irrespective of who their shareholders are. Consequently, referring to Malta as an ‘offshore jurisdiction’ or a ‘tax haven’ is entirely baseless and purely sensationalist.”

The IFSP said Malta was an early adopter of all EU directives and other international agreements aimed at improving transparency, had a tax system fully compatible with OECD principles, and added that the country was fully committed to the efforts undertaken by the OECD in combatting Base Erosion and Profit Shifting (BEPS) in international tax structures.

“Malta will also fully transpose into its legislation those elements of the EU’s recently adopted Anti Tax Avoidance Directive – itself implementing some of the OECD BEPS recommendations – which are not already included in Malta’s tax legislation.”