The opening of a company in Panama may have been politically inappropriate but it cannot be defined as corruption, former Prime Minister Karmenu Mifsud Bonnici said.

Speaking on his weekly television programme on Smash TV, the former Labour PM never once mentioned Minister Konrad Mizzi or OPM chief of staff Keith Schembri, but he said that it is wrong to accuse people of corruption or illegalities when what they did is legal.

He however said that their choice to open a company in Panama may have been politically inappropriate.

Dr Mifsud Bonnici explained at length what tax havens are and what the difference between tax evasion and tax avoidance is, saying that countries in the European Union such as Luxembourg and Germany can be considered as tax havens because one paid fewer taxes there than what one would pay in other countries, including Malta.

He said Malta had enacted laws about the setting up of trusts in the 1990s, and this meant that the country created a system whereby people could legally put their money in trusts.

Setting up of companies in Panama is not illegal or corrupt, he said, but it is done for people to pay less tax on their income. It is also wrong to label everything as corruption, he said.