Paradise Papers: Bono says he welcomes investigation into offshore investment

Lithuanian tax authorities are preparing to examine a business in which the U2 frontman had a ‘100 per cent passive’ involvement

Bono performs during U2's "Joshua Tree Tour 2017" (Getty)

Bono has released a statement to say he is “extremely distressed” over recent reports that he was named in the Paradise Papers leak.

The trove of 13.4 million files, leaked after a hack against law firm Appleby, has exposed the financial dealings of dozens of companies and high profile figures in tax havens around the world.

The U2 frontman invested in the Malta-based company Nude Estates, which bought a shopping mall in Lithuania for £5.1m shortly after it opened in 2007.

Nude Estates then transferred ownership to Nude Estates 1, a company based in Guernsey, which imposes no tax on company profits. Malta is a famously low-tax jurisdiction which demands that firms pay just 5 per cent tax.

It has since been revealed that Lithuania’s tax authorities are preparing to examine the details of the business over concerns that it avoided profit tax.

“It should be noted that STI [state tax inspectorate] commences an inspection on taxpayers based on the evaluation of risk of tax breaches,” the country’s tax authorities said in a statement. “Taxpayers having offshore transactions more often score higher points of risk.”

Bono said: “I’ve been assured by those running the company that it is fully tax compliant, but if that is not the case, I want to know as much as the tax office does, and so I also welcome the audit they have said they will undertake.

“I take this stuff very seriously. I have campaigned for the beneficial ownership of offshore companies to be made transparent. Indeed, this is why my name is on documents rather than in a trust.

“The fact is, I welcome this reporting. It shouldn’t take leaks to understand what’s going on where. There should be public registries so that the press and public can see what governments, like Guernsey, already know.”

Bryan Meehan, who runs the Nude Estate companies, told The Guardian: “As manager of Nude Estates, I approached friends and investors around the world, including Bono, to take a minority investment in the company.

“Bono’s involvement has been 100 per cent passive and he has not visited any of the locations, nor has he had any involvement in the decision making.”

Bono, who is know for his extensive charity work with organisations including UNICEF, One Campaign and Make Poverty History, has also been criticised over his previous tax dealings.

Critics have claimed that U2 could have helped to eliminate poverty in Ireland if their tax base remained in the country, instead of the method whereby the band sent their money via the Netherlands.

However, in 2012 Bono said U2 paid “a fortune” in tax, and that the Netherlands system was “some smart people we have working for us trying to be sensible about the way we’re taxed”.

Follow The Independent for the latest on the Paradise Papers leak here