Under this framework, taxpayers may enter into agreements with the Commissioner for Tax and Customs to regularise tax offences by paying penalties and outstanding dues, thereby avoiding criminal prosecution for the offences covered by the settlement.

The mechanism also applies to certain “connected breaches” and predicate offences, linked to the tax offence, such as money laundering and fraud.

The bill was introduced and approved over 12 days in August 2025. It was tabled in Parliament on the same day as Bills 143 and 144, two parts of a controversial planning reform package that has since dominated public discourse and sparked protests. 

These are the known cases so far:

Christian Borg:

• A car dealer who was charged in a €1.6 million tax evasion and money laundering case.
• Prime Minister Robert Abela is his former legal advisor and once profited from a 2018 property deal with him.
• The agreement also covers his co-accused, Monique Mizzi and Joseph Camenzuli, a former Labour Party photographer.
• Borg has also been charged with kidnapping in a previous case.

Aron Mifsud Bonnici:

• A lawyer who was charged in a €1.6 million tax evasion and money laundering case.
• Mifsud Bonnici received over €2.4 million in payments into his personal bank accounts between 2016 and 2019. However, during those same four years, Mifsud Bonnici declared a total income of €680,000.
• He is a former advisor to Konrad Mizzi.
• He has been separately charged in connection with the Vitals Hospitals case.

Nigel and Mikaela Scerri

• Accountants behind Ennesse, who were charged with tax evasion and money laundering in connection with €1.5 million in tax and VAT discrepancies.
• €15 million in assets frozen across 15 companies.
• The court found sufficient prima facie evidence for them to stand trial in February 2025.

Potential impact on ongoing cases: The VAT Carousel

• Martin Farrugia and Henriette Cassar have been accused of defrauding the VAT system by approximately €62 million.
• The case involves multiple companies, including NCCF, MAM Construction Ltd, and MWF Construction Ltd.
• The accused have pleaded not guilty, and proceedings are ongoing.
• Amphora Media is informed that authorities are aware of additional businesses linked to the scheme. However, there have been no further prosecutions.

In reply to a series of parliamentary questions by MP Adrian Delia, Finance Minister Clyde Caruana confirmed that the Malta Tax and Customs Administration (MTCA) has received several applications under the new law and is currently processing them.

Caruana did not say whether any fines or sanctions have yet been imposed. He also declined to provide figures on the number of individuals or companies involved, the size of those companies, or the types of businesses concerned, referring the questions to the relevant minister.

Malta already has a significant problem with uncollected taxes. Official figures show that as of 2024, Malta has accumulated over €8 billion in uncollected tax, €6.1 billion in VAT and €2 billion in other taxes.  The government has written off over €6.6 billion of that figure.

Meanwhile, the FATF had expressly noted how Malta’s ability to fight tax evasion was one of the reasons the country was placed on the grey list to begin with – and was one of the three requirements to get off it. 

Magisterial inquiries have been one of Malta’s few avenues for citizens to seek justice and hold those in power accountable. A new bill threatens to close that door – and recent data shows private citizen-filed inquiries account for just 0.3% of all magisterial inquiries.

In response to a series of parliamentary questions by MP Amanda Spiteri Grech, Justice Minister Jonathan Attard revealed that only 25 magisterial inquiries were initiated by private citizens between 2017 and 2024, a fraction of the 7,650 carried out by magistrates & initiated by authorities. 

Private citizen-filed inquiries have led to major investigations and, in some instances, criminal charges into significant scandals, including the VGH/Steward case, 17 Black, the Panama Papers, Electrogas, and the Mozura wind farm deal in Montenegro.

Bill 125 would drastically limit that ability. It has courted significant controversy and was introduced amid fresh requests for inquiries into Prime Minister Robert Abela’s cabinet members. Critics say that the bill has been rushed through parliament and that the government has been unwilling to engage in public dialogue.

A vote on the second reading of the Bill will be taken later today. The committee stage will follow, and a final vote will be taken after its third and final reading.

Under the proposed law, citizens must present evidence to the police, not the magistrate, and follow stricter guidelines. This would undermine accountability, especially if authorities fail to act.

The Bill removes the ‘reasonable suspicion’ standard, introduces a stricter evidentiary requirement, and places magisterial inquiries under the supervision of the Attorney General, which could compromise judicial independence. 

The government argues that the Bill aligns with recommendations made by the Venice Commission, which stressed it should “not abandon Malta’s legal traditions but evolve to provide more effective checks and balances than those currently in place.” 

PL MEP Alex Agius Saliba and Minister Attard travelled to Brussels for a series of meetings, including former LIBE Committee Chair Juan Fernando Lopez Aguilar. Agius Saliba has reportedly begun circulating a government-produced ‘fact sheet’ about Bill 125. 

The Daphne Caruana Galizia Foundation has urged the European Parliament’s Socialist and Democrats (S&D) group to retract their support for the proposed reform.

Bill 125 Slashes Citizens’ Right to Seek Justice

Besides eliminating direct citizen petitions and imposing stricter evidentiary requirements, Bill 125 mandates individuals to wait 6 months for police inaction for an initial request for a magisterial inquiry. 

A two-year deadline is being introduced, after which all collected evidence would be passed onto the Attorney General, regardless of the inquiry’s status. Given the court’s long-standing issue with delays, this could result in a premature conclusive status for incomplete investigations. 

Another major reform is the introduction of penalties for abuse. If a magistrate determines that the inquiry initiated by a citizen against the accused was “unfounded, frivolous, vexatious or abusive of the judicial process”, the same citizen would be held responsible for covering costs. 

These expenses could run into the millions—for context, the inquiry into Egrant cost over €1.2 million, while the Vitals exceeded €10 million.