After three days of evasion David Cameron has been forced to admit that he benefited from a tax-free offshore trust his father set up.
The revelation, coming after days of partial responses to inquiries regarding the extent to which his financial affairs were linked to murky offshore tax avoidance schemes, raises the question of whether he is suitable to lead much needed tax transparency reforms.
“This government is completely tied to the interests of the very wealthiest,” said Unite assistant general secretary Steve Turner.
The news comes after it emerged that Cameron lobbied against EU legislation to reign in off-shore tax avoidance in 2013, despite repeated public vows to do the opposite.
In a hastily arranged interview with ITV, Cameron confessed that he legally sold shares in a tax haven fund that paid no UK tax in 30 years for £31,000, four months before becoming Prime Minister.
He also admitted that there was no way of knowing whether any other money left to him by his multi-millionaire stockbroker father, Ian, had benefited from tax haven status.
Ian Cameron, who died in 2010, was one of those named in a massive cache of leaked documents from a Panamanian law firm that helped set up opaque off-shore funds for the world’s super-rich.
The International Consortium of Journalists, which received 11 million leaked files from the Mossack Fonseca firm in Panama, says Cameron Sr used the firm to help shield the Blairmore Holdings Inc investment fund from British tax authorities.
The leak exposed the shadowy and complicated network used by the global super rich to hide their wealth. Others named in the documents include close associates of both Russian president Vladimir Putin and Syrian dictator Bashar Al-Assad.
In total the “Panama Papers” leak has identified the heads of state of five countries as directors or shareholders in offshore companies, as well as officials, relatives and associates of state leaders from more than 40 others.
They also implicate several Conservative party donors, three former Tory MPs and six serving Tory members of the House of Lords.
Despite admitting his own personal involvement in tax haven schemes, however, Cameron insisted that his father didn’t set up Blairmore to avoid tax.
“It was set up after exchange controls went so that people who wanted to invest in dollar denominated shares and companies could do so,” he claimed.
His statements were contradicted by tax barrister, Jolyon Maugham, on Channel Four News.
“This fund is an invitation, to those who chose to accept it, to avoid tax. What David Cameron has talked about as morally repugnant is tax avoidance,” Maugham said.
Labour’s shadow Treasury minister, Richard Burgon, stated that Cameron’s admissions demonstrated a “crisis of morals at the heart of the Conservative government” and said questions still hung over the Prime Minister regarding his intentions whilst lobbying against EU measures to curb tax avoidance in 2013.
“After four days of refusing to answer this question David Cameron has now finally been forced to admit he directly benefited from Blairmore, a company which paid no tax in 30 years. He must now further clarify whether or not he or his family were benefiting directly or indirectly in 2013 when he was lobbying to prevent EU measures to better regulate trusts as a way to clamp down on tax avoidance,” Burgon said.
“David Cameron needs to properly put the record straight in full on this matter and issue a statement to parliament on Monday. We can’t let this crisis of morals at the heart of the Conservative government further undermine public trust in the office of prime minister or the principle that those who govern us should pay their tax like the rest of us.”
Steve Turner pointed out that Cameron’s ties to offshore tax havens was no surprise.
“This story comes on the heels of Osborne hailing that mega corporation Google paying ‘mates rates’ taxes was a success, the Sunday Times revelations that Osborne’s family firm avoided tax and of course the cuts in capital gains tax announced in the Budget that were paid for by the further attacks on disabled people the government was forced to back off from,” he said.