Labour was accused of hypocrisy last night after demanding an inquiry into the Queen’s tax affairs – despite questions over its own arrangements.
Jeremy Corbyn suggested the monarch should apologise if £10million of her personal fortune had been invested offshore to avoid paying tax in Britain.
The so-called Paradise Papers leak revealed the Queen’s estate invested the money in funds registered in Bermuda and the Cayman Islands, two British overseas territories at the centre of the offshore finance industry.
Jeremy Corbyn suggested the monarch should apologise if £10million of her personal fortune had been invested offshore to avoid paying tax in Britain
Mr Corbyn and Shadow Chancellor John McDonnell demanded an inquiry following the revelations. However, yesterday it emerged that:
- A Labour council avoided paying millions of pounds in tax after it used an offshore company to buy a local park;
- The party’s London headquarters is rented from a tax-exempted property trust fund based in Jersey; and
- Mr McDonnell receives a Westminster Council pension which comes from a fund managed by a Guernsey-based firm.
Last night, Tory MPs accused Labour of hypocrisy.
Nadine Dorries said: ‘I’m very sure the Queen has no idea where her financial managers invest her money. However, given that Corbyn’s Labour Party rent Labour HQ for £1million per year from a tax-exempt offshore company, his comments do whiff of hypocrisy.’
Jacob Rees-Mogg called Mr Corbyn ‘ill-informed’, adding: ‘There is no advantage to offshore structures to honest taxpayers – of which I am one.’ The Paradise Papers link a string of companies and political figures to secretive overseas arrangements. They include claims that £10million of the Queen’s fortune was invested in offshore tax havens.
There is no suggestion that those involved acted illegally.
A spokesman for the Queen’s private estate, the Duchy of Lancaster, said: ‘We operate a number of investments and a few of these are with overseas funds. All of our investments are fully audited and legitimised. The Queen voluntarily pays tax on any income she receives from the duchy.’
The so-called Paradise Papers leak revealed the Queen’s estate invested the money in funds registered in Bermuda and the Cayman Islands
Asked if the Queen should apologise, Mr Corbyn had told the Confederation of British Industry’s conference in London: ‘Anyone that is putting money into tax havens in order to avoid taxation in Britain … should do two things: not just apologise for it, but also recognise what it does to our society.’
Later he called for an inquiry ‘into all the revelations about the Paradise Papers’. Asked if that included the Queen, Mr Corbyn told Bloomberg: ‘Everybody. The Royal Household are subject to taxation… these issues all must be part of that.’
His comments came despite the fact that Labour-run Warrington Council bought an offshore company that owned Birchwood Park. Local Labour MP Helen Jones has said this would see the council avoiding £10million in tax.
A spokesman for Warrington Council admitted that it had not paid stamp duty, but could not say exactly how much had been saved. The spokesman added that ‘the council agreed to leave the business offshore’ to ‘complete the acquisition in a timely and efficient manner’.
It also emerged yesterday that the Labour Party rents its London headquarters from a tax-exempt property unit trust fund based in Jersey. The party is believed to pay almost £1million a year to lease the eighth floor of the Southside development. The building is owned by an investment trust established in Jersey, and managed by Schroder Property Managers (Jersey) Limited.
A Labour spokesman said the party ‘receives no benefit as a result of the financial arrangements of the building owner … we remain committed to changing the current tax environment and to tackling tax avoidance’.
A spokesman for the Labour leader also insisted he did not demand an apology from the Queen. ‘Jeremy did not call for the Queen to apologise but said anyone who puts money into a tax haven to avoid paying tax should, and that they should recognise the damage done by avoidance to society,’ they said.
Mr McDonnell, 66, revealed he receives £14,421 from his council pension when he published his tax return and P60 last year. However, the cash from Westminster City Council comes from a fund that invested £100million in Guernsey-based global equity manager Longview in 2014.
Last night a spokesman for Mr McDonnell said: ‘This is a pension which is administered by a Tory council, regulated under a Tory government, and John is one of the chief campaigners to get the fund to bring the funds back onshore.’