Ashcroft admits he’s a non-dom with statement
Tory deputy-chair and millionaire funder Michael Ashcroft today revealed that he is non-domiciled in the UK.
He published a statement on his website clarifying his current legal status.
The statement says:
I am making this statement in advance of the release by the Cabinet Office of limited information about the award of my peerage and of the undertakings I gave at the time.
While I value my privacy, I do not want my affairs to distract from the general election campaign. I have therefore decided to release a copy of the letter which I wrote to William Hague, and to expand on what actually happened.
As the letter shows, the undertakings I gave were confirmed in a memorandum to William Hague dated 23rd March 2000. These were to “take up permanent residence in the UK again” by the end of that year. The other commitment in the memorandum was to resign as Belize’s permanent representative to the UN, which I did a week later.
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 ten 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 councillor by the Prime Minister) and Sir Ronald Cohen, both long-term residents of the UK, are also “non-doms”. As for the future, while the non-dom status will continue for many people in business or public life, David Cameron has said that anyone sitting in the legislature – Lords or Commons – must be treated as resident and domiciled in the UK for tax purposes.
I agree with this change and expect to be sitting in the House of Lords for many years to come.
The statement and letter are here.
[via @MirrorJames]
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Reader comments
Cor! This is very shifty.
Ashcroft can sit in the Lords and fund the tories while paying taxes only on his declared UK earnings.
This is an area ripe for a public airing.
Is this really a surprise to anyone? His title, for God’s sake, is Lord Ashcroft of Belize! The requirement was always going to be that he become UK resident for tax purposes – the Govt simply aren’t entitled to demand that people give up their domicile to become a peer (or an MP).
If people are outraged that it’s possible for non-domiciled people to sit in Parliament, I can only suggest that they vote Conservative or Liberal Democrat – as being the two parties that have pledged to allow only UK resident and UK domiciled individuals sit in Parliament.
As for the politics side, this ought to have been released years ago to close the subject down. It was a personal decision for Ashcroft, but I think he’d have minimised the damage by early disclosure. It shouldn’t matter to anyone, but there we are.
So, technically, he remains a tax dodger then?
3 – no. Technically he pays all the taxes he is legally obliged to do. And I hear he sues if you suggest otherwise.
4 (which I’m not condoning, incidentally, just pointing out. Ask the Independent)
Technically, it means that in future he is prepared to pay tax on his worldwide income in order to continue to sit in the Lords. Quite a generous sacrifice, I’d guess.
Well, glad that’s clarified then.
Must say I am surprised! Wish I had that William Hague clip trying to make out he didn’t know teehee
Clever to mention Paul and Cohen of course.
Apparently Lord Paul (whom Gordo made a privy councillor) would rather leave the Lords than give up his non-dominess.
So, they all stink…
9 – which may be tricky for Lord Paul, as it’s not currently possible to relinquish a life peerage.
Labour Non-dom peers and their donations;
• Lord Paul – £69,250 in donations to Labour, including £45,000 to Gordon Brown’s leadership campaign. A close friend of Gordon Brown and appointed to the Privy Council last summer, he has admitted to being ‘non-dom’.
• Lakshmi Mittal – £4.125 million in donations to Labour.
• Sir Ronald Cohen – £2.55 million in donations to Labour. Cohen was appointed chair of the Social Investment Taskforce, which was announced by the then Chancellor, Gordon Brown.
• Sir Christopher Ondaatje – £1.7 million in donations to Labour.
• Sir Gulam Noon – £532,826 in donations to Labour.
• William Bollinger – £510,725 in donations to Labour.
• Mahmoud Khayami – £985,000 in donations to Labour including £5,000 to Hazel Blears’ deputy leadership campaign. He has helped bankroll two flagship schools, one of which Gordon Brown opened, and was personally thanked for a donation by Tony Blair.
• Dr David Potter – £90,000 in a donation to Labour. He has previously delivered a lecture at Downing Street.
Compared to about £4.4 from Ashcroft for the Tory party….so maybe it’s time for Labour to shut up and stop being so hypocritical – none of their non-doms are agreeing to anything near as much as Ashcroft is.
@10 Didn’t Tony Benn manage such a feat in order to sit in the Commons?
12 – He was a hereditary peer – Viscount Stansgate. The Earl of Home also gave up a hereditary peerage to become Prime Minister as Sir Alec Douglas-Home. Life peerages, however, cannot be given up. Lord Mandelson has, however, been making noises about changing the law on this. For purely disinterested reasons no doubt.
In fact, if the Tories do change the law to prevent non-doms from sitting as parliamentarians, they would almost certainly allow for the giving up of life peerages, as otherwise it would be very unfair on all those Labour peers who would then be forced to pay UK tax on their overseas earnings.
11 – and if we’re going to be strictly even-handed about it, only Lord Paul of your list is, um, a Lord. The rest are non-dom donors…
Simples. Abolish non-dom status. If the US can tax world-wide income, why can’t we?
@13 Ah right. My mistake!
@11 Tyler
Yep. That’s probably why its been so quiet from the Labour Party.
Ashcroft also lets the tories use his private plane, which I do not believe is factored into the declared donations but I could be wrong.
The tories have been happy to attack Labour about trades union donations and the some of the payments you describe. Some double-standards there?
For me, the issue about Ashcroft was that he appeared to renege on the deal to become domiciled in the UK when he took his peerage. His silence on this matter and tax issues suggested he had something to hide and there have been concerns about his activities in Belize.
What I despise most about all of these people is the sort of “only little people pay taxes” attitude while trying to buy influence.
For me, the issue about Ashcroft was that he appeared to renege on the deal to become domiciled in the UK when he took his peerage.
He didn’t though. He was asked for assurances that he would become resident in the UK for tax purposes. Which he did. There was never any request for him to become domiciled here too, indeed it would have been strange if there had been, as there is no requirement that peers (or MPs) be domiciled in the UK.
Right, I confused two similar-sounding requirements. Sorry.
How much tax does he pay in the UK now? Does anyone know?
@18
He was asked for assurances that he would become resident in the UK for tax purposes. Which he did. There was never any request for him to become domiciled here too…
(Emphasis my own) Forgive my ignorance on the matter, but what’s the difference between “resident” and “domiciled”?
“Residence”.
Do you live here?
The simplest definition (and yes, of course, this is tax, it gets more complicated) is are you in the UK for more than 91 days a year? Then we’d like tax on all you earn in the UK please.
“Domicile”.
Are you really from here though? Do you have some connection with another country which really means that you’re one of them rather than one of us?
The simplest definition (and yes, this is tax, it’s more complicated) is where do you expect to die and where do you expect to be buried?.
In this case, if you’re a non/domiciled but resident, then we’ll have tax on what you earn in the UK plus any money you bring into the UK. But we’ll not tax you on whatever you earn where you’re really from and which you keep out of the UK (and this then becomes worldwide earnings that aren’t repatriated to the UK).
Adding CGT and IHT to this becomes more complicated still.
“If the US can tax world-wide income, why can’t we?”
‘Coz it’s usually considered to be bastard unfair. Pay tax where you live not where you happened to be born. Boris Johnson, for example, was born in the US. Why should he pay US tax for the rest of his life just because of that accident?
Further, I’m pretty sure that it would be in breach of EU law. We’ve got freedom of movement (so you can go and live elsewhere) and you’re not allowed to discriminate on the basis of EU nationality. So, as an example, an Englishman living in Portugal would, if taxed by the UK while non/resident, would be being treated differently than a Frenchman or Portuguese who also lived in Portugal. Not allowed to do that.
But now that we’ve got the letter from Ashcroft I’m terribly amused, I must say. Try going back through the Guardian’s pieces on this over the past few months. They continually get confused between residence and domicile.
Forgive my ignorance on the matter, but what’s the difference between “resident” and “domiciled”?
From the IR regulations:
4.2 Broadly speaking, you are domiciled in the country where you have your permanent home. Domicile is distinct from nationality or residence. You can only have one domicile at any given time.
This is where Ashcroft has been shifty. He was asked to give guarantees about making him UK resident, but the implication was clear (especially by the comments Hague at the time that this would cost him millions) that this meant UK-domicile as well.
22 – up to a point. The specific requirement was ‘full UK residence’. That’s not a legal term, so Ashcroft queried its meaning with the Govt and HMRC. They decided that it meant ‘tax resident’. For all the smoke and mirrors, Ashcroft was asked for a specific commitment, gave it and has kept to it.
The confusion between domicile and residence is similar to that between deficit and debt. The intrusion of law or finance leaves most arts-graduate journos hopelessly muddled. As to whether it’s appropriate for Ashcroft to be non-domiciled – what’s his title again? Lord Ashcroft of Belize…
21 – ooh, sorry as an addendum to all this. Complaints that Ashcroft has somehow been bankrolling the Tories with dodgy money from overseas miss the point that any money that has been donated has, by definition, been ‘brought onshore’ and been subject to UK tax. People with the interests of the Exchequer at heart should be delighted that he has given £4.6m to the Tories, as that’s money that has been brought within the purview of the UK tax authorities.
For us mere mortals it still looks shifty. A rich man’s way of having his cake and eating it.
Lets look at Lord Rothermere while we’re at it. Claims to be domiciled in France but has a jolly nice house in Somerset where his kids go to school. Avoids paying UK taxes where possible yet owns the Daily Mail with all its associated influence in Britain.
@21 “If the US can tax world-wide income, why can’t we?”
“‘Coz it’s usually considered to be bastard unfair. Pay tax where you live not where you happened to be born. Boris Johnson, for example, was born in the US. Why should he pay US tax for the rest of his life just because of that accident?”
Come off it Tim Worstall – disingenuous in the extreme. You could do it on the basis of holding the passport (and all the taxpayer funded protection requested & required in the name of Her Maj that that implies). If you don’t like it, hand in your passport and take on the nationality of your domicile – very easy.
Ashcroft can take his seat in the Belizean House of Lords.
“If you don’t like it, hand in your passport”
The Americans get you there as well. You end up having to pay all the taxes you would have paid for the next 10 years as you hand it in.
As I said, bastard unfair.
Tim J
Perhaps you can explain how a UK domicile of origin becomes a resident non-dom?
Seems like a nice dodge if you can wangle it.
28 – it’s quite tricky to become a non-dom while remaining tax resident. If, for the sake of argument, you were born here and lived here for the first 25 years of your life, you would be at that point resident and domiciled in the UK. If then you emigrated to Australia, married and settled down, you would transfer residency and domicile to Australia.
If, 30 years later, you moved to the UK for a five year work placement, but you retained property and business interests down under, and your children lived there, you would, unless you chose otherwise, become a UK resident, non-domiciled taxpayer.
I was always under the impression that one could not maintain a domicile of choice without residence. Has this changed recently?
30 – I think it’s always been the case that you could be domiciled somewhere other than your residence. Think of a Frenchman working for BNP Paribas in London. He is resident in the UK, but he’s still probably domiciled in France.
He could elect to change domicile if he decides that he intends to live in the UK forever, but if he has an intention (however vague) to return to la belle France his domicile will remain France.
31 – Yes, but they’re French. What is a UK-resident, UK-national doing claiming non-dom status?
In fact, reverse your locations. A UK national working for Barclays in Paris. They might be resident in France but domiciled in the UK. They could elect to change domicile if they intend to live in France forever …
Non-dom status is just a convenient tax-dodge for the rich – and it’s nice to see the rules being tightened by the Revenue recently.
32 – he was largely brought up in Belize, and is a Belize national, holding dual nationality. He even used to be Belize’s representative at the UN. He has never been UK domiciled. He has taken ‘Lord Ashcroft of Belize’ as his title, and has expressed his desire to retire there. He has as good a claim to be a non-dom as anyone I can think of.
Incidentally – HMRC tightened up the rules on residency, not domicile.
33
So wtf is he doing in British politics then?
Typical tories, always flying the flag with one hand, and taking money from any foreigner with the other.
And you people have the nerve to complain about unions. At least they are British people who pay tax here and have lived their lives here. Unlike tory scum.
Anti-immigrant are we now Sally?
BTW: Bryan Gould, Labour frontbencher of old, was (and is) a New Zealand citizen.
Does anyone know how much money Ashcroft saves by not having to pay taxes on all his income in the UK? I don’t have very much, but any savings I could make would be greatly appreciated!
“I think it’s always been the case that you could be domiciled somewhere other than your residence”
I was talking specifically about domicile of choice. I’d always assumed it was abandoned on departure but I see from my dusty copy of Dicey and Morris that it isn’t necessarily. Hence the parsing of the word “permanent”.
Funny how Worstall always turns up to defend the scummy tories, and yet begs us to believe that he is not a tory.
Oh sorry, of course he is a UKIP supporter. ( not that there is any difference) You know, one of those who believes so much in the UK that he lives in Portugal.
“Oh sorry, of course he is a UKIP supporter. ( not that there is any difference) You know, one of those who believes so much in the UK that he lives in Portugal.”
Yes Sally dear: one of those who loves Europe, Europeans and yet hates the specific political structure of the European Union.
It is possible you know: even if the Tories get elected you’ll probably like British people, the Britain that you know and desire: and yet hate the political system running it.
Today’s Daily Mirror is claiming Ashcroft has not paid £127 million in tax. (http://www.mirror.co.uk/news/top-stories/2010/03/02/lord-ashcroft-tax-scandal-the-unpaid-127million-115875-22079116/)
Extraordinarily dodgy numbers from Chris Huhne there. That works, even in principle, only if Ashcroft takes the money out of a company each year. If he leaves it in the company then there’s no tax to be paid whether he’s a non dom or not.
41 – oh look. The story’s been removed. Now, I wonder why that could be…
On an entirely unrelated point, I would have thought that the word ‘tax-dodger’ was both defamatory and, given that Lord Ashcroft pays all the tax he is legally obliged to, untrue. How deep are Trinity Mirror’s pockets these days?
42, Yes Tory crooks often use the libel laws to hide their wrong doing. Archer, Hamilton, etc etc.
Always funny to watch the tories defend someone who has never lived here for most of his life yet they moan and whine about trade unions who represent 6 million British people who live here and pay tax here.
As ususal the tories don’t care just as long as you fund them.
” someone who has never lived here for most of his life ”
So, Dear Sally, why should he have to pay tax here?
Stop trolling Tim. He should pay (fully resident) tax here because he’s sitting in our legislature and funding one of our political parties.
He is paying resident’s tax. He’s just not paying domiclied tax.
I can read the papers, too. “Fully resident” = domiciled.
What I don’t understand is how you defend it as though it’s morally acceptable. OK, it’s within the rules, but even Cameron has said that he will change the rules in this case, because he knows it’s not acceptable. It’s as though you’re campaigning for the principle of the immoral use of rules.
“So, Dear Sally, why should he have to pay tax here?”
He doesn’t have to. He can fuck off back to where he came from and stay out of British politics.
But again funny to watch you defend the tories. Why don’t you just admit you are a tory Worstell and stop lying.
47
Timmy does not do morality. Or if he does, it is like the snake oil that came out of Ayn Rand’s demented writings.
Tyson has got a very full list of Labour donors. Where did the list come from? Almost anywhere, they are easily available and have been for years but the man Ashcroft has kept his donation and amount of tax paid secret. It has been dragged out through questions asked under the Freedom of Information Act. The obvious thing to do was to admit the situation years ago. Bad luck for Conservatives it has got out only a few weeks before a general election. Why ever was this information so secret if now they pretend it does not matter? Of course it matters. The Conservatives are dressing themselves up in the flag as they often do just before an election because it is the last refuge for Dave and his mates, but the man who really runs the party and from whom they run is shown as Non Dom. Ashcroft would rather buy Conservative politicans than pay UK tax where the money would be wasted on schools, defence equipment and hospitals.
“Fully resident” = domiciled.
The actual undertaking was ‘permanent residence’. This was agreed by the Government to mean “a long term resident”. That means tax residence, but not does not requre domicile. You can disagree with this if you like, but the Government agreed the legal meaning of the undertaking with Lord Ashcroft years ago.
Ashcroft complied with the terms of the undertaking he gave, and the donations he made through his companies were legal and permissible. You can carry on squealing about it, but the law’s the law kids.
@51 Like I told Tim W, I can read … and there’s little point arguing over the fact that I sloppily used the term “fully resident” instead of domiciled.
And as I told Tim W, Ashcroft may well have compiled with the letter of the law, but the impression given to the public and (according to them) to the Tory hierarchy was that he was domiciled in the UK. Any changes to the original undertaking to allow him non-dom status was a secret to all of us.
Cameron agrees that non-dom status is incompatible with membership of the legislature. So, like Tim W, you’re arguing the virtue of the immoral use of rules. When the public is demanding more transparency and less “weasel words”, this is self-defeating.
And as I told Tim W, Ashcroft may well have compiled with the letter of the law, but the impression given to the public and (according to them) to the Tory hierarchy was that he was domiciled in the UK. Any changes to the original undertaking to allow him non-dom status was a secret to all of us.
I’m afraid this is simply untrue. The questions that the Tories were consistently asked was whether Ashcroft had become resident. As in this exchange between Paxman and Hague:
Just one final point, in the current climate of suspicion about politics your deputy chairman Lord Ashcroft, a man whose peerage you lobbied for, saying that he would become resident in Britain for tax purposes, can you just tell us, is he resident in Britain for tax purposes now?…
You got him the peerage on the basis that he would become resident in this country for tax purposes and you’ve never asked him?…
It’s a simple questions, ‘Michael, are you resident here for tax purposes’?
The undertaking was always understood to be that he became resident for tax purposes. There was no ‘change’ to the original undertaking. He was asked for an undertaking to become tax resident. He has become tax resident. Where, precisely, is the story here?
guys – it is not actually very easy to change domicile and it really is irrelevant. the guy is resident in the UK and pays UK tax. Why are you so worried about where the guy wants to be buried?
Don’t make me laugh. Now it’s your turn to deliberately obfuscate by using the term resident, which you full-well know is ambiguous.
What is not ambiguous is that Hague made the statement that Ashcroft, when complying to the undertaking given, would lose millions of pounds in tax. This is a clear implication that he would be domiciled in this country.
What is also not ambiguous is that Hague has said that he was only made aware in the last few months that Ashcroft was a non-dom.
So it is transparent that, after the undertaking given to Hague, Ashcroft re-negotiated the undertaking with the Cabinet Office to allow him non-dom status, and that this remained a secret to the public and Tory hierarchy.
Also, you don’t address the morality issue. Cameron thinks non-dom status for legislators is untenable, yet at the same time his main backer and senior party official has that status. How does that add up?
Just saying rules-is-rules doesn’t change that one iota.
@54. He can be buried where he likes. Non-dom status is an anachronism and a tax evaders charter. If you have a UK passport, then you should pay UK tax on all of your earnings. End of. The US enforce this, so why can’t we?
“What is not ambiguous is that Hague made the statement that Ashcroft, when complying to the undertaking given, would lose millions of pounds in tax. This is a clear implication that he would be domiciled in this country.”
Eh? If you are not resident and then become resident your tax bill goes up. If you are non dom and then become dom your tax bill goes up.
The fact that his tax bill went up does not aid us in distinguishing between these two things.
@57. You sound like Blair trying to sell the Iraq war. Do you think that we (and Hague) are that stupid. No, don’t answer re Hague. It’s obvious from his radio interview that the undertaking had changed – he was asked when he knew it had changed.
Don’t make me laugh. Now it’s your turn to deliberately obfuscate by using the term resident, which you full-well know is ambiguous.
What is not ambiguous is that Hague made the statement that Ashcroft, when complying to the undertaking given, would lose millions of pounds in tax. This is a clear implication that he would be domiciled in this country.
By becoming tax resident, Ashcroft will have increased his tax bill very substantially. There is no implication of domicile changing in Hague’s statement. ‘Tax resident’ is not an ambiguous term. It has a specific legal meaning. ‘Permanent residence’ on the other hand is an ambiguous term, and has no specific legal meaning. That’s why Ashcroft’s lawyers (the very efficient, if rather less than lovely A&O) negotiated with HMG to discover what its legal implications were.
It’s obvious from his radio interview that the undertaking had changed – he was asked when he knew it had changed.
Again, this is simply not true. The undertaking was made back in 2000/2001. It hasn’t changed. Ashcroft would, presumably, have told Hague that he had fulfilled the terms of this undertaking, no more no less.
Tim W and Tim J seem to me to be playing the role that Aaronovitch and MacShane do for the Labour squirarchy – the “honest policemen” whose role is to continue saying “move along now, peeps, move along, nothing to see here”.
I’d like to see Cameron or Hague stand this argument up in public. Like it or not, the general public think that non-dom status is tax evasion for the rich (if you don’t believe that, then you need to get out more). Cameron has at last recognised this partly, and is publicly committed to preventing non-doms from entering parliament. I wonder what his reaction was when he found out that his major financier and deputy chairman has that status? Does it not make him appear to be a right tw*t?
Let him stand up in public and say: “no, I don’t think that non-doms should be in the Lords, but Ashcroft is different because the current rules allow it”. He’d be laughed at.
“Like it or not, the general public think that non-dom status is tax evasion for the rich”
So, umm, us urban (and urbane!) sopphisticates, us who know how things really work.
What are we supposed to do, follow the moods and whims of the mob? Or try and identify the reality of the situattion and then inform people?
This isn’t a right wing thing either….there’s plenty on hte left who talk about “false consiousness”.
You’re just digging a deeper hole.
“… us who know how things really work.”
“What are we supposed to do, follow the moods and whims of the mob?”
In these times, when we’ve had the credit crunch, and the bankers get to maintain their bonuses, while the general public (aka mob or “little people”) is going to pay for it all with their jobs and a much lower standard of living – how do you think these kind of sentences play with them while you extol the virtues of non-dom status.
Like I said. Say it in public, during the election, and see what the reaction is. Incredible.
One of the crucial tests of domicile is where you are going to be buried. Why are the people fussing about this issue so concerned about where Ashcroft wants to be buried?
‘Tax resident’ is not an ambiguous term. It has a specific legal meaning. ‘Permanent residence’ on the other hand is an ambiguous term, and has no specific legal meaning.”
The two Tims just jerking off for the tory party as usual.
The point is that the tories have always had to be funded by a few millionaires and billionaires, yet moan and winge about millions of British people forming unions and funding the Labour party.
Just another example of how unpatriotic the tories really are. That Cypriot guy who gave Thatcher a million in the 80s is still on the run from British justice. And Archer has been show up to be the tosser anyone with a brain always thought he was.
“So, umm, us urban (and urbane!) sopphisticates, us who know how things really work.”
You have never shown you know anything works. You just recite Rand talking points. That is not showing you understand jack shit.
Concentrating on the legalistic minutiae obfuscates this issue: Ashcroft, Murdoch, Barclay brothers, Rothermere… How much influence is it right for a UK tax avoider to have on the politics of our country?
and how much influence should the non-dom funders of Labour have? only asking…
“and how much influence should the non-dom funders of Labour have?”
None. Non-dom status should be abolished.
Yurrzem!,
Concentrating on the legalistic minutiae obfuscates this issue: Ashcroft, Murdoch, Barclay brothers, Rothermere… How much influence is it right for a UK tax avoider to have on the politics of our country?
The ‘minutiae’ are important because they determine what taxes people are obliged to pay.
As I understand it your examples (and the Guardian Media Group as but one other example) all pay what they are legally obliged to pay. They pay according to the rules. Are they supposed to pay more than the rules require? Amounts based on, say, the whims of bureaucrats or the mob?
Tim J,
I’m not sure what you mean by “tax resident”. Presumably as any UK sourced income was already liable for tax then the only change to his tax bill would have involved a change of domicile. There seems little doubt that there has been at the very least an attempt to finesse the point. A better argument for Ashcroft might be that if he is in breach of a condition then it is a condition which was unfairly imposed on him and not on others. My own view is that his tax status is the least troubling aspect of the story. It’s truly remarkable that the party’s deference to Ashcroft has led to something like this blowing up on the eve of the election when the boil could, and from their point of view, should have been lanced months ago.
I’m confident that Ashcroft hasn’t broken any laws. However, the law is the minimum standard. It’s the standard to which we require even the most contemptible of people to adhere.
We should expect more of people who seek to shape our country. The Conservative Party should expect more of themselves, and of their friends.
@ 70, 71,
Agreed.
If the best we can expect from our political masters is that they aren’t actually breaking the law, which appears to be the sum and substance of the defence here, as in: “Whew! That was a close run thing, but hey!” then the fault lies with us as an electorate. If we expect politicians to be role models, and I think we should, then we need to create a hell of a stink.
I’m not sure what you mean by “tax resident”. Presumably as any UK sourced income was already liable for tax then the only change to his tax bill would have involved a change of domicile.
It’s the legal definition of what we’re supposed to be talking about. UK non-residents pay tax on their UK income in their country of residence. Provided that a double taxation treaty exists between the countries (and there is one between the UK and Belize) a Belize resident will pay no direct tax at all on his UK income.
Becoming a UK resident is a major change in your tax status. But it has very little to with your domicile. It is possible to change your domicile, although there are hurdles you have to pass, but HMRC will never unilaterally change it. Provided you have a different domicile of origin, which Ashcroft does, it is entirely up to him when to change that.
Again I’m surprised, and not just on here, on the sheer ignorance of the law in this country. On Question Time last night you had people like Shirley Williams and David Dimbleby saying, as a matter of fact, that Ashcroft ‘didn’t live in this country’ and that he ‘had promised to become resident here and he has broken that promise’. He does live in this country, he is resident here, he never promised to change his domicile, and there is no way that HMRC (or HMG for that matter) could make him. QT as a whole was quite remarkably defamatory.
How much influence is it right for a UK tax avoider to have on the politics of our country?
Well there we are. Marx, Hayek, Friedman: how much influence is it right for these furriners to have on our politics?
If the best we can expect from our political masters is that they aren’t actually breaking the law, which appears to be the sum and substance of the defence here
It’s not a ‘defence’ so much as a statement of the facts.
I think everyone here agrees that Ashcroft should have been more open about his arrangements much sooner.
@63 donald
Because it makes some £400 million difference in Inheritance Tax!!!
That is far more than all the UK tax that Ashcroft would pay in his lifetime.
[Chris Huhne and the Daily Mirror seem to never have heard of double taxation treaties and the idea that he would be paying CGT on investment profits in a period when investment returns have been less than zero is ridiculous]
@71 simon
Yes – I note that you only expect the Conservatives and their friends to have high standards. That is why the press makes a fuss about Ashcroft and not New Labour’s coterie of non-doms
@66 Yurrzem!
Everyone who contributes to an ISA or a Personal Pension or who uses Gift aid for their gifts to charity (let alone VCTs, film finance, and Gordon’s umpteen other wheezes) is a tax avoider. You are narrowing down the franchise pretty radically
@68 gastro george
So you want to charge your Polish plumber UK tax on his income from letting out his bedsit in Gdansk while working in Liverpool? That is contemptible!
If you abolish non-dom status then every foreign national will be liable to TWO sets of income tax on his/her worldwide income, instead of one.
Mittal’s worldwide income is liable to tax in India, Ashcroft’s in Belize
@76 The Polish plumber presumably has a Polish passport. I’m advocating abolishing non-dom status for UK nationals. Further, you wouldn’t allow Polish nationals in the legislature – if you want to to be in the legislature you need to be a UK national, and pay domiciled UK tax.
Regarding double taxation – it’s not beyond the wit of the IR to arrange for reciprocal tax agreements with other countries to avoid double taxation. Those other countries should, of course, not be tax havens.
@76
Would you like a complete list of all of the people and organisations of whom I expect high standards? In a response to an article about Ashdown, it doesn’t seem unreasonable to pay special attention to him and his party.
And the activities of the Labour party, LibDems and any and all others is in no way an excuse for the possibly low standards of the Conservatives. Just because someone else is of less than sterling character doesn’t mean it’s OK for one to be a blackguard.
@77 Have you never heard of dual nationality – I heard about as a pre-teen (special dispensation to wear long trousers because he was American but not resented because he was such a nice kid and he could beat me at Chess). So that doesn’t work.
Are we allowed to exclude EU citizens from standing for Parliament? As for the House of Lords, we have had non-resident and non-domiciled peers in the past.
“Further, you wouldn’t allow Polish nationals in the legislature – if you want to to be in the legislature you need to be a UK national, and pay domiciled UK tax.” NOT YET – that is a Cameron proposal. New Labour has no hesitation about including and “ennobling” non-doms – as long as they support Labour.
“Regarding double taxation – it’s not beyond the wit of the IR to arrange for reciprocal tax agreements with other countries to avoid double taxation. Those other countries should, of course, not be tax havens.” Well, actually it is because California won’t play ball. Tax Havens would not agree because then GB would get ££mm from income earned or received there that had no relation whatsoever to the UK. Thirdly can you imagine Russia or China co-operating?
@78
“And the activities of the Labour party, LibDems and any and all others is in no way an excuse for the possibly low standards of the Conservatives. Just because someone else is of less than sterling character doesn’t mean it’s OK for one to be a blackguard.”
No, it does not – and I never suggested that it was: I was pointing out that the general public only requires the Conservatives to adhere to moral standards. The exposure of Tom Driberg (the Chairman of the Labour Party) as a homosexual KGB agent linked to murderous East End gangsters had no visible impact, but the claim that the DEPUTY chairman of the Conservative Party had . The Mittal scandal had a negligible impact on Tony Blair’s popularity
DEPUTY chairman of the Conservative Party had not paid more tax than he was legally required to do is the “major political scandal” utterly eclipsing the drug-related resignation of the boss of Scotland’s largest (and the UK’s third) city, Gordon Brown’s failure to give a straight answer to any questions at the Iraq enquiry, the arrest for re-offending of Jon Venables who was released only a few years after he brutally murdered a small child, torture by US forces of individual captured by MI6, deaths in Afghanistan because Brown restricted MOD funding below minimum operational requirements, the fraud charges against three Labour (but no Conservative, LibDem or SNP) MPs etc etc
It is not the arrest of Jon Venables that is the problem – it is why some idiot released him.
Why should we not pay special attention to David Sainsbury? While there is no evidence of anything that the Tories did in power or out of it to benefit Ashcroft’s business interests, the company of which David Sainsbury was Chairman until he was pushed out after losing sector leadership to Tesco (and in which he is still one of the largest shareholders) has benefited massively from New Labour changes to planning laws in defiance of the Competition Competition and other expert advice.
@79 “Have you never heard of dual nationality”. Of course. Let them choose their domicile. The principle is fair taxation. If Ashcroft chooses Belize over the UK, then he shouldn’t be a Lord, not should he be financing one of our political parties.
I don’t care about the past. I don’t care for New Labour’s stance on this either.
Neither do I care if tax havens or China or Russia disagree. If you’re a UK national, then you pay tax on all of your world-wide income unless there is a reciprocal tax agreement with the country of your current residence.
“If you’re a UK national, then you pay tax on all of your world-wide income unless there is a reciprocal tax agreement with the country of your current residence.”
WHY?
Please supply a sound philosophical argument for this new religion.
Yes, it is a religion because it is a belief system with no objective support from scientific data. I can admire and recognise certain belief systems, but I can see no logical or philosophical basis for this one – most religions have one or the other or both
Reactions: Twitter, blogs
- Liberal Conspiracy
Ashcroft admits he's a non-dom with statement http://bit.ly/dgmPNJ
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RT @libcon: Ashcroft admits he's a non-dom with statement http://bit.ly/dgmPNJ
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RT @libcon: Ashcroft admits he's a non-dom with statement http://bit.ly/dgmPNJ
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RT @Alex_Ross1983 Ashcroft admits he’s a non-dom with statement http://bit.ly/9rJpDd
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Ashcroft admits he’s a non-dom with statement http://bit.ly/9rJpDd
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