Construction magnate Charles Polidano has entered a new payment deal with the tax authorities to settle decades of unpaid dues, making a huge down payment.
The deal, struck this month, saw Polidano, known as Iċ-Ċaqnu, hand over at least €20 million earlier this month.
The hefty bank overdraft, sources said, had been partly financed through the sale of a property held by his business group for some €11 million earlier this year.
Polidano has entered a payment plan to settle the remaining amount which sources said adds up to around €4 million.
The deal was struck in recent weeks after some two years of talks with the Inland Revenue Department. In 2020, Times of Malta reported that Polidano, 62, one of the wealthiest men on the island, had racked up €30.4 million in unpaid taxes on his flagship company Polidano Brothers Limited.
Since then, he is understood to have settled two smaller tax bills of €6.3 million and €1.2 million, stemming from other companies he owns, which have also long been outstanding. These were also being discussed with the authorities at the time.
Two years ago, Polidano had been ordered to settle the amount or face the possibility of court action. What had followed were some 24 months of fraught negotiations with the authorities.
The following year, in 2021, Polidano had come close to negotiating a deal with the government that would have seen his tax dues partly set off against the sale of a large plot of land he had made to the government’s Housing Authority.
That deal, however, was stopped dead in its tracks soon after Times of Malta reported it.
Polidano had then been placed on a ‘blacklist’ which was meant to preclude him from bidding for government contracts. His company, Polidano Group, is one of the leading construction firms in the country, regularly involved in major national infrastructure projects.
To be eligible to bid for government tenders, interested parties are meant to be up to date with their payments to the fiscal authorities. In March of this year Times of Malta reported how Infrastructure Malta revoked the award of two multimillion-euro tenders due to his lack of tax compliance.
Polidano had won tenders to carry out €11.8 million worth of construction works to extend the Marsamxett ferry landing as well as a €19.7 million tender for the upgrading of Lascaris Wharf. However, both contracts were revoked.
Sources said that, for years, Polidano, and other industry players, would circumvent this requirement by routinely entering tax repayment plans, only to stop honouring them once they secured another major government contract.
That loophole was essentially closed off earlier this year.
Times of Malta is informed that Finance Minister Clyde Caruana had directed the authorities to halt the issuing of payment plans for major defaulters and, instead, start insisting on large lump sums being paid out.