‘Queen should apologise if tax avoided offshore’
THE Queen should apologise if her private estate invested £10m of her personal fortune offshore to avoid paying tax in Britain, Jeremy Corbyn has suggested.
The Labour leader said those involved in the “shocking” Paradise Papers leak of secret documents should apologise if they have invested offshore to avoid tax and also “recognise what it does to our society”.
The disclosure of 13.4 million documents reportedly ties major companies and political figures to secretive overseas arrangements.
It includes claims that the Queen has £10m of her personal fortune invested in an offshore tax haven.
There is no suggestion that those involved acted illegally.
Asked if the Queen should apologise for the offshore investments revealed in the papers, Mr Corbyn told the CBI’s annual conference in London: “Well anyone that is putting money into tax havens in order to avoid taxation in Britain, and obviously investigations have to take place, should do two things – not just apologise for it but also recognise what it does to our society.
“Because if the very wealthy person wants to avoid taxation in Britain and therefore put money into a tax haven somewhere, who loses? Schools, hospitals, housing, all those public services lose and the rest of the population have to pay to cover up the deficit created by that.
“And so I think with the Paradise Papers, which I have been reading through like all of us this morning, are quite shocking.”
The Duchy of Lancaster, the private estate of the Queen, was found to have millions of pounds invested in offshore arrangements.
Around £10m from the Queen’s private fund was paid into funds in the Cayman Islands and Bermuda between 2004 and 2005, according to reports. A small part of the cash was traced to a lender which has previously been criticised for ripping off poor customers.
The Queen voluntarily pays tax on any income she receives from the Duchy.
A spokesman for the estate said: “We operate a number of investments and a few of these are with overseas funds. All of our investments are fully audited and legitimate.”
Also among those said to be named in the papers are former Tory treasurer Lord Ashcroft and US president Donald Trump’s commerce secretary, Wilbur Ross, who is reportedly linked to a Russian firm.
Mr Corbyn and Labour are calling for a public inquiry into aggressive tax avoidance to urgently restore public confidence in the tax system.
But Theresa May has refused to commit to a formal probe or to introducing a public register of who owns offshore companies and trusts in British tax havens, saying only that people should “pay the tax that is due”.
Asked whether she would insist on an inquiry and public registers, the Prime Minister told the CBI: “We have seen more revenues coming to HMRC over the last few years – since 2010 £160bn extra that they have been able to raise. But we do work, there’s already work that’s been done to ensure that we see greater transparency in our dependencies and British overseas territories and we continue to work with them.
“HMRC is already able to see more information about the ownership of shell companies, for example, so that they can ensure that people are paying their tax. We want people to pay the tax that is due.”
Downing Street said Mrs May did not have any direct offshore investments and her assets were held in a blind trust, in line with normal practice for ministers.
“There is a well-established set of procedures and mechanisms,” the Prime Minister’s official spokesman said.
The Paradise Papers represent the biggest data leak since the Panama Papers release last year, and have been analysed by almost 100 media organisations.
Hundreds of individuals and companies reportedly have had their overseas investments exposed by the files, which are also said to reveal that major global companies have exploited offshore schemes to avoid tax.
First obtained by the German newspaper Suddeutsche Zeitung, the documents stem from two offshore service providers and company registries from 19 tax havens, the Guardian reports.
The International Consortium of Investigative Journalists oversaw the project.
A small portion of the Queen’s investments – £3,208 – was found to have bought a holding in lender BrightHouse, the BBC and the Guardian reported.
The rent-to-buy firm has previously been accused of exploiting customers with high interest rates, but maintains it does responsible business.
Money ended up in BrightHouse via a company called Dover Street VI Cayman Fund LP, in which the Duchy of Lancaster reportedly invested $7.5m (£5.73m) in 2005.
The organisation bought an interest in a project involved in the takeover of BrightHouse and Threshers, which went bust.
A further £5m was invested in 2004 in the Bermuda-based Jubilee Absolute Return Fund Ltd.
The Dover Street investment is said to form only 0.3% of the total value of the Duchy.
Beyond the UK, the White House was hit by fresh claims that it has ties to Russia.
Mr Ross is allegedly shown by the papers to have money in a shipping company which deals with Russian leader Vladimir Putin’s son-in-law.
But Mr Ross told reporters during a trade visit to London it would be “incorrect” to characterise Navigator’s relationship with Sibur, a gas company co-owned by Kirill Shamalov, who is married to Mr Putin’s daughter, as a partnership of any kind.
Social media, technology and sports companies are also said to have money sheltered in overseas havens, alongside a line-up of A-list celebrities.
A Treasury spokeswoman said £2.8bn of the additional £160bn recouped by HM Revenue and Customs since 2010 came from “those trying to hide money abroad and to avoid paying what they owe”.
She also highlighted an extra £800m the Government has provided to fund the efforts of 26,000 HMRC staff tackling tax avoidance and evasion.