Inland Revenue failed to send tax assessors to PM’s ‘undervalued’ ODZ property

Tista’ taqra bil-Malti

Former Inland Revenue Commissioner Marvin Gaerty failed to send his department’s architects to assess Robert Abela’s newly acquired ‘undervalued’ property in 2017 although lRD officials had internally flagged the need for a valuation according to the law, The Shift has learned.

In the latest twist over possible tax fraud by Abela over the acquisition of a two-tumoli ODZ property in Zejtun, which Abela declared he acquired for just €600,000, Gaerty is refusing to explain his lack of action over this deal.

Asked by The Shift to account for why his department did not send its assessors to compile a valuation of Abela’s villa, which industry experts insist was clearly undervalued by the prime minister, Gaerty hid behind the law, insisting that “no information on persons can be provided due to secrecy and confidentiality”.

However, tax experts consulted by The Shift said that while it is true that the Commissioner is not at liberty to divulge certain information, the same law allows for his discretion, particularly if an issue of public interest is involved such as a possible case of tax evasion by the head of government.

Gaerty was removed from his position at the end of last year and was instead transferred to a newly created role at the Finance Ministry as head of a tax review working group.

Through a contract published by notary Dorianne Arapa in July 2017, Abela and his wife declared that they had acquired a massive ODZ property in Zejtun for €600,000. Real estate agents said the value of the property at the time was closer to €2 million. No loan was needed for this payment.

The contract was signed just five days after the PA gave its green light to sanction almost half of the property, a large part of it built illegally. A fine of €45,000 was imposed on the sellers, Joseph and Alfrida Camilleri. The PA has refused to say whether the fine has actually been paid.

According to the law, the CIR is obliged to send the department’s architects when a suspicion of a declared undervaluation is flagged. However, for some reason, Gaerty decided not to send the assessors to make a valuation report, although the contract was immediately flagged internally.

One of the department’s architects told The Shift that under normal circumstances such a contract as the one presented by Abela would be immediately referred to the architects for an assessment.

“It is obvious, even at first glance, that Abela’s contract needed at least an assessment. The department’s decision in this case is very strange, to say the least, and there may be a case of complicity in tax evasion.  At this stage questions need to be answered by the department, and convincingly. An investigation by the ombudsman may also be needed,” the official said.