It was worth listening to Today this morning if only to hear Lord Ashdown under siege over the issue of Sir Philip Green and his tax status. The Lib Dem peer was asked about how the government could seriously talk about battling tax avoidance given the recent hiring of the retail tycoon as an efficiency czar: As the interviewer asked:
“If this government was really serious about tax avoidance it would not have employed, would it, Sir Philip Green, who is also accused of avoiding taxes, perfectly legally…but there he is, advising the government on waste. If the Lib Dems really had power in this government he wouldn’t be there would he?”
Ashdown said he would not criticise the appointment. He then rattled off a list of the many changes achieved by the coalition (pupil premium, tax breaks for low-income families, etc). It was as if he didn’t want to discuss the tycoon at all.
But the Lib Dems do seem to be facing both ways on the issue of tax at the moment. Yesterday Danny Alexander announced a new £900m to spend on tackling the issue. But how does this square with hiring Sir Philip?
As Peston reminded us yesterday.
But in 2005 Sir Philip saved himself around £300m in tax on a £1.2bn dividend from his main company, Arcadia – because Arcadia is registered as owned by his wife Tina, who is resident in the tax haven of Monaco.
This was entirely within the law. (Evasion is illegal. Avoidance is legal). But why then is Clegg still positioning himself as some kind of champion campaigner against tax avoidance? I’ve seen a copy of this afternoon’s speech and he is about to say the following:
“People who avoid and evade paying their taxes will no longer get away with it either. We all read the headlines about benefit fraud…..but when the richest people in the country dodge their tax bills that is just as bad.”
“Unlike Labour, we’ll be tough on tax cheats too. We will crack down on the super rich who hide away money overseas…..tax avoiders and evaders must have nowhere to hide.”