MP’s manor house hotel ramps up €125,967 tax debt

Reform Party MP Eerik-Niiles Kross’s company, Kõue Mõis OÜ, has not yet submitted its 2016 annual report. The company also has a tax debt of €125,967.

Kõue Mõis OÜ runs Kau Manor in Kose, Harju County. Kross and his wife, artist Mary Jordan, bought the then crumbling property in 2007, restored it, and turned it into a boutique hotel.

The company had tax debt in earlier years as well, sums ranging from €1,300 to €16,500 in different months in 2014, only three months with less than a five-figure debt in 2015, and eventually €30,000 to €40,000 in most months last year.

Kõue Mõis’ tax debt has been on the increase since November last year, reaching €120,492 on July 18. On top of that, the company owes €5,475 in interest. Of the total debt, €67,701 has already expired.

As Kross explained to ERR, the tax debt occurs due to several different factors. “First of all certainly because I’m a bad manager. Arguably also because I pay salaries before I pay tax, and because I’d rather be indebted to the state than to my employees,” Kross said.

On top of that, the tax debt was also caused by bad hiring decisions made in the past, but now they had a team he was very happy with, he added.

“One could also argue that we’re enjoying Estonia’s overly high labor taxes to the fullest, as we’re not paying salaries under the table. Observing historic traditions is important as well, Estonia’s manors have always been in someone’s debt since medieval times,” Kross quipped.

The company was dragging along a month’s worth of social tax or two, and they were expecting to even things out this year, if the numbers remained the same, he added.

The 2016 annual report was currently with the auditor and to be submitted as soon as it was ready.

Kau Manor employs 28. For 2015 it reported a sales revenue of €471,000 and a loss of €226,979. Kõue Mõis OÜ’s parent company, Trustcorp, also has tax debt in the amount of €2,943.

In 2015 Swedbank withdrew as Kau Manor’s largest investor, replaced by Blue Oil Limited, a company registered in the British Virgin Islands. Blue Oil took over a loan from Swedbank in the amount of about a million euros, the collatoral for which is the Kau property.

The Riigikogu’s Anti-Corruption Select Committee looked into the swap in 2015, but decided not to investigate.

Read more news on the city site of Tallinn.

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