Construction tycoon Charles Polidano has been ordered to settle more than €40 million in tax dues or face possible court action.  

Polidano, known as Iċ-Ċaqnu, has over the past few days been served with a number of court documents ordering him to pay a massive tax bill, some of which stretches back to the 1990s. His company is one of the leading construction firms in Malta, regularly involved in major national infrastructure projects.

Polidano, 60, one of the wealthiest men on the island, has racked up €30.4 million in unpaid taxes on his flagship company Polidano Brothers Limited. It also has another two smaller tax bills of €6.3 million and €1.2 million, which have also long been outstanding, sources said.

The court orders, known as judicial acts, were filed by the Inland Revenue Commissioner in the first week of November. 

Tax department sources said that Polidano had previously entered into a number of payment plans with onerous obligations to get his affairs in order. However, despite signing up to pay regular €5,000 instalments, it was not long before he defaulted once again.

Aside from his main company, Polidano has also been ordered to settle taxes for a number of other entities he controls. These include the holding company of his controversial Montekristo Estates in the outskirts of Siġġiewi.

Once described by the planning regulator as “one of the largest illegally-built construction sites on the island”, Montekristo Estates is several million in the red with the tax collector. 

Polidano’s beverages company, which produces his own Montekristo beer and wines, is estimated to owe around €340,000 in fiscal dues. Even his vineyard has a pending tax bill of around €200,000. 

One of his smaller construction firms, GJA Construction Company Limited, owes some €366,000.

Sources within the tax authorities said Polidano’s situation raised questions within the inland revenue commissioner’s office. 

“How is it that Ċaqnu owes this much in tax, going this far back, and he was still able to apply for, and win, government tenders for public works?” a senior source at the authority asked. 

To apply for government tenders, bidders must be in possession of a compliance certificate which ensures that applicants have no major outstanding dues and that their affairs are in order. 

Replying to questions, Polidano’s lawyer Jean Paul Sammut confirmed that the construction tycoon had been notified of the court documents in recent days.

Polidano’s lawyers have begun contesting the amounts allegedly owed to the tax authorities, Sammut said, and the first court hearings on the matter are expected to be held in January. 

Sammut said the business group is awaiting payments from various government entities in relation to a number of construction projects, some of which run into millions of euros. These payments will be offset against outstanding dues, Sammut said.

Pending payments also cover the transfer of land to the Housing Authority. 

“Court sittings have been scheduled and the group will be defending its position,” Sammut said.

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