Embattled Peruvian President Pedro Pablo Kuczynski told a congressional investigative committee that he used a company in the British Virgin Islands to legally avoid paying US taxes, according to audio heard by Reuters on Sunday.
Kuczynski made the disclosure during seven hours of questioning on Friday as he tried to disentangle himself from a growing corruption scandal less than a week before a new impeachment vote in the Peruvian Congress.
A former Wall Street banker who is married to an American, Kuczynski told the committee that the offshore company, Dorado Asset Management, was controlled by his daughter and helped him sidestep US taxes on his properties in Peru.
“Why would we pay Uncle Sam and Mr Trump a bunch of money that’s here in Peru?” Kuczynski is heard telling the committee in a four-minute segment of the audio recording from the closed session.
Kuczynski is to meet with US President Donald Trump, who himself has called tax avoidance “smart,” at a gathering of the region’s leaders in Lima next month.
Karina Beteta, the opposition congresswoman who asked Kuczynski about Dorado, confirmed that the contents of the recording were accurate.
Despite being legal, tax avoidance schemes have faced a wave of criticism since the 2016 publication of the so-called “Panama Papers,” an investigation into the shadowy world of offshore holdings and hidden wealth by the International Consortium of Investigative Journalists.
Kuczynski held US citizenship before renouncing it to run for president in 2016, when he was elected on hopes that he would use his private sector experience to clean up government corruption.
However, less than two years into his term, Kuczynski’s wealth and financial history has come under increasing scrutiny as opposition lawmakers accuse him of colluding with Odebrecht, a Brazilian construction company under investigation for bribery.
The Congress is to vote on whether to force Kuczynski from office on Thursday. A similar impeachment motion failed passage by eight votes in December.
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