WorldPep Guardiola took advantage of tax amnesty in Spain to regularize an...

Pep Guardiola took advantage of tax amnesty in Spain to regularize an account in Andorra

Pep Guardiola, Barcelona icon and one of the most winning coaches in the world, held a checking account in Andorra until 2012, when he benefited from the tax amnesty approved by the government of Mariano Rajoy to regularize the money in his account in the Principality. Until then, the current Manchester City coach had not declared to the Spanish Ministry of Finance the money he kept in that account. Lluís Orobitg, the coach’s tax advisor, explains that Guardiola only used his account at the Banca Privada de Andorra (BPA) to deposit the salary he received as a player for Al Ahli, the Qatar club where he played between 2003 and 2005. By benefiting from the amnesty tax, the athlete regularized almost half a million euros, paying a 10% tax on the interest that his money had generated in the previous four years, which were not prescribed.

Pep Guardiola is one of the names that appear in the archives of the Pandora Papers, an investigation coordinated by the International Consortium of Investigative Journalists (ICIJ). For two years, more than 600 journalists from 117 countries analyzed 11.9 million documents from 14 law firms specializing in the creation of offshore companies in tax havens. These companies, located in countries other than the domicile of their administrators, are legal as long as the owner declares them where he resides. The problem begins, in the eyes of authorities, when what holders in these jurisdictions are looking for is anonymity, no taxation or laundering dirty money. In Spain, EL PAÍS and the television channel the friday analyzed the leak in search of public interest people who took advantage of the world’s most opaque jurisdictions. The result is more than 700 companies linked to Spain, among which dozens of relevant personalities stand out.

The name of 50-year-old Josep Guardiola i Sala appears in a document from Alemán, Cordero, Galindo y Lee (Alcogal), one of the law firms at the center of the Pandora Papers’ journalistic investigation. He is a representative of the Panamanian company Repox Investments. The company was founded in February 2007, after Guardiola retired as a professional player and four months before he was hired as coach of Barça B. Orobitg explains that Repox’s existence has nothing to do with the maroon club or with Guardiola’s financial interests in Panama and that the company had no activity. In practice, it was a shell company to hide the real owner of the money in the Andorra account.

He is a representative of the Panamanian company Repox Investments, created in 2007, and without any activities. It was a ghost company

The creation of Repox, explains the advisor, was an initiative of the Andorran bank in which the coach had a checking account to safeguard his identity. Offering this type of instrumental company — which adds a layer of opacity to the real owner of the money — was common practice at that time in the Principality, according to sources at the Tax Agency.

Afsi, a small management firm created by Andbank in 1997 and which was in business until at least 2018, intervened in the formation of the company. Afsi, which plays a central role in the Pandora Papers and had dozens of Spanish nationals among its clients, specialized in setting up companies in jurisdictions such as the Virgin Islands, Belize, the Bahamas or Seychelles. In the case of Guardiola, the Panamanian law firm Alcogal forwarded the company’s incorporation and deed documents to Afsi, as can be seen from the analyzed documentation.

Property with the name of Guardiola and the document informing the Andorra office about sending the documentation. THE COUNTRY/FRIDAY/ICIJ

After leaving Barça and after his spell in Italian football, Guardiola was signed in 2003 by the Qatari club Al Ahli, which, according to published information, paid just over two million euros (about 12.44 million reais) per season. to the midfielder born in Santpedor (Barcelona). In his first season in the Qatar championship, he was named best foreign player. The opening of the current account in Andorra coincides with this phase in Arab football. Orobitg justifies that the decision to open an account in Andorra was due to the impossibility of obtaining a certificate of residence in that country, where he would not pay taxes. The player decided to deposit his salary in Andorra, a country with a more favorable tax rate where he didn’t pay taxes because he is not a resident of the country. His advisers explain that they did not deposit the money in Spain for fear that, without a certificate from Qatar, the Tax Agency could object to him benefiting from the expatriate tax regime when the reality is that in those two years he played and resided in the emirate.

Return to Barcelona

In 2007 Guardiola obtained the title of coach and began managing Barça B. The following year he made the leap to the first team, which he trained until the summer of 2012. During his years as coach of Barça —in which he won two Champions Leagues and three Spanish Championships—kept the account open in Andorra, without declaring it to the Spanish tax authorities. Guardiola also did not declare interest, although the coach already resides in Spain. In April 2012, at the height of the previous financial crisis, the government of Mariano Rajoy approved the fiscal amnesty. And the football coach, advised by his advisors, took the opportunity to reveal this money to the tax authorities.

The Special Tax Declaration (DTE), as the Rajoy Executive called the amnesty, was a window that that Government opened so that companies and individuals could regularize their dirty money by paying a 10% tax, much lower than the taxes that had ceased to be pay. The Executive’s objective was to raise 2.5 billion euros. The procedure was a fiasco. The Ministry of Finance had to relax the requirements and ended up receiving half of what was expected. According to the documents consulted by this newspaper, Guardiola presented form 750 to the Tax Agency — a document with which he formally benefited from the tax amnesty — and settled almost half a million euros. The amount corresponds to the interest on the money accumulated in the account between 2007 (last year not prescribed) and 2010, which is why the law required to pay 10%. For the salary of the two seasons at the Qatar club, he didn’t have to pay anything, as it was already prescribed. This newspaper could not know the total amount accumulated in Andorra or the exact year the account was opened.

Guardiola, on a trip to Qatar to promote the country's bid to host the 2022 World Cup.
Guardiola, on a trip to Qatar to promote the country’s bid to host the 2022 World Cup.AFP

The Spanish government’s fiscal amnesty was controversial because it allowed many fraudsters to launder money at a reduced cost. This process angered the Treasury inspectors and was overturned by the Constitutional Court. But it was enjoyed by more than 30,000 people, mostly entrepreneurs. Among the few names that have surfaced are political leaders and some of the great fortunes of Spain: Rodrigo Rato, former vice president of the Government and former managing director of the IMF; Francisco Granados, right arm of the former president of the Comunidad de Madrid Esperanza Aguirre; Diego Torres, former partner of Iñaki Urdangarin; José Ángel Fernández Villa, former head of the mining sector at [central sindical] UGT; the brothers Antonio and Jorge Gallardo, owners of the Almirall laboratories; Ildefonso Falcones, bestselling writer and author of La Catedral del Mar; and Oleguer Pujol Ferrusola, one of the sons of the former president of the Generalitat [Governo da Catalunha] Jordi Pujol. Not only politicians or businessmen with legal problems benefited from this process, but hundreds of small businesspeople or people with assets in other countries that were not up to date with the tax authorities, as in the case of Guardiola.

The tax amnesty offered by the Government contemplated the disappearance of shell companies created abroad before the end of 2012. According to the consulted sources, this explains why the Panamanian Repox Investments was closed on December 21 of that year, which was also the last of Guardiola as Barça coach. In January 2013, the Alcogal law firm sent Afsi the documents regarding the closure of the company. A few days later, Bayern Munich confirmed that Guardiola would be their coach with a salary of 17 million euros per season. The former Barça coach makes generous donations each year to non-profit organizations; last year alone, it allocated a million euros to the Angel Soler Daniel Foundation to help health centers fight the effects of the coronavirus. He has also made major contributions to Activa Open Arms, the organization that rescues refugees in the Mediterranean. This altruistic practice continued to be developed with associations in Germany and now the United Kingdom.

The government’s pardon (against the 10% payment) to people who kept money hidden did not prevent the Tax Agency from carrying out inspections in an important part of those who benefited from the measure. The Treasury did not investigate the filing of the tax amnesty declaration (form 750), but used the data presented to track other irregularities. According to sources close to the technician, Guardiola has not been subject to any inspection by the Tax Agency since 2012.

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