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Saturday, November 13, 2021

The Prime Minister and tax evasion

Are the days when we expected politicians to set an example really over? I'm not talking about personal lives, that day never arrived, but in terms of looking after the best interests of the state, in this case ensuring we the Treasury receives all taxes it is due, so those worse off do not end up bearing a disproortionate burden.

And yet despite all that expectation, nobody seems to surprised to find Boris Johnson jetting off to spend time in a £25,000 a week mansion, linked to Costa del Sol property businesses owned by Zac Goldsmith’s family that engaged in a multimillion-pound tax evasion scheme, according to Spanish courts. Zac Goldsmith of course is also a Minister of the Crown.

The Guardian says that court papers obtained by the Guardian show tax inspectors ordered two property companies owned by the Goldsmith family to pay €24m (£20m) in unpaid taxes and fines after investigating what they said was a suspicious property deal:

The tax authority’s findings have been upheld by one of Spain’s highest courts, with judges agreeing the companies effectively engaged in a deliberate effort to evade tax and committed “serious” violations of the law.

Documents indicate Spanish authorities are still seeking to recover the funds and could even seize parts of the family’s land, which is spread across more than 600 hectares (1,480 acres) of private woodland about 10 miles from the Marbella coastline.

A Swiss lawyer for one of the companies denied the case amounted to a “tax evasion” issue, describing it as a dispute that resulted from a mistaken land valuation by Spanish tax authorities. She said the finding against her client was “extremely hard to understand, to put it mildly”. Court papers indicate there will be a further appeal.

However, the revelation raises difficult questions for the prime minister, who has already faced criticism for refusing to declare his use of the luxury property in the MPs’ register of interests, which would require him to disclose the monetary value of the gift from the Goldsmith family.

Downing Street has insisted the holiday at the villa, which costs £25,000 a week to rent, was “unconnected with the PM’s parliamentary and political activities”. Zac Goldsmith, a Conservative minister, is a longstanding friend of Johnson and his wife, Carrie. In 2019, Johnson personally appointed Goldsmith to the House of Lords after his friend lost his seat as an MP.

Johnson is now likely to be asked how much he knew of the Spanish tax investigation into companies owned by the Tory minister’s family before staying at their villa, which is in a secluded corner of an estate beside swimming pools, a tennis court and an organic farm.

The revelations raise questions for both Goldsmith, a senior minister, and his brother Ben, a non-executive director at the environment department, about the extent to which they were aware of or involved in the property deal .

The paper makes it clear that the Goldsmith family holdings are complex and that while the villa Johnson stayed in was not owned by a company involved in the tax investigation, public records suggest it forms part of the Goldsmiths’ wider sprawling property holdings in Benahavís. Nevertheless. as Prime Minister he should have been aware of the issue and kept well clear of it.
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