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Monday, March 01, 2010

Lord Ashcroft comes clean on his tax status

At last after years of speculation, the man who is bankrolling the Conservative campaign in marginal seats, has come clean on his tax status. He is a "non-dom" and does not pay tax on his earnings abroad in the UK.

As the Guardian says, Lord Ashcroft's confirmation puts to rest a decade of speculation about his tax status and raises serious questions for the Conservative party, which has been part of cross-party moves to ban non-doms from parliament:

Ashcroft made a statement on his website (pdf) in anticipation of the release under the Freedom of Information Act today of the promise he made to the government when he was made a peer in 2000 to "take up permanent residence in the UK again".

He said: "In subsequent dialogue with the government, it was officially confirmed that the interpretation in the first undertaking of the words 'permanent residence' was to be that of 'a long term resident' of the UK. I agreed to this and finally took up my seat in the House of Lords in October 2000. Throughout the last 10 years, I have been declaring all my UK income to HM Revenue.

"My precise tax status therefore is that of a 'non-dom'. Two of Labour's biggest donors - Lord Paul (recently made a privy counsellor by the prime minister) and Sir Ronald Cohen, both long-term residents of the UK, are also 'non-doms'."

The statement reveals that his promise was made to William Hague, the shadow foreign secretary, raising questions about Hague's failure to confirm in the past decade details of Ashcroft's tax status.

Hague has consistently refused to answer questions about Ashcroft. Christopher Graham, the information commissioner, accused the party of being "evasive and obfuscatory" on the issue when he ruled that the Cabinet Office should reveal the details of the promise Ashcroft was known to have made at the time of his ennoblement.

Ashcroft today said that he will relinquish his non-dom status to comply with new rules, which have cross-party support.

It is amazing what a freedom of information request can throw up if the person requesting it is persistent enough.

Personally, I think Lord Oakeshott, the Liberal Democrat peer, who has campaigned for a change in the law to prevent non-doms sitting in parliament, has got it right. He said: "Ashcroft has been sitting for the last 10 years in the British parliament, he has been voting on British laws and British public spending when he has not been paying full British tax like the other 60 million of us. That's a democratic disgrace. He has been pouring millions into conservative campaigning when he is not paying full British tax. So you have someone who keeps his assets offshore out of the British tax system and trying to buy a British election."
It is amazing what a freedom of information request can throw up if the person requesting it is persistent enough.

That's why we have freedom of information.

It's not just that a non-dom doesn't pay tax - it's that they get a discount on tax by saying that they are not committed to Britain. So if they aren't committed to Britain, why should they have any influence over our politics?
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