Avoiding both tax and the question

Tweet After ducking and diving for 10 years, Lord Ashcroft has finally admitted what most of us suspected all along – he doesn't pay full UK taxes. It's still not entirely clear whether his donations to the Tories are from his UK earnings or from the overseas earnings on which he's avoided paying UK tax.

The Electoral Commission are still investigating whether the company used to make most of the donations is actually trading in the UK or whether it's just a device to channel money from Belize to the Tories, which would otherwise be illegal. Their investigation has taken a long time. It could have taken less, of course, if the Tory leadership had not been so "evasive and obfuscatory", presumably in the hope that all would not become clear until after the forthcoming election.

The proceeds of Ashcroft's tax avoidance do not seem to have found their way directly into local Tory coffers, but their own annual accounts reveal that staff from Ashcroft's office are regular attendees at their campaign meetings. Of course, they do not need money from Ashcroft locally, because they are largely financed from the proceeds of hedge funds with the single objective of repealing the Hunting Act.

(As I've noted before, one of the advantages of the way in which hedge funds are generally structured is that the profits are treated as being capital gains rather than income, and therefore taxed at a lower rate. It's another legal form of tax avoidance, and one which Plaid are pledged to stop.)

What I found hardest to believe was Cameron's response to Ashcroft's revelation. The first part was that everything is all right now, because after 10 years of ducking the question, we now know the truth, and the second is that there are one or two Labour donors who make use of the same tax avoidance loopholes. Wrong on both counts.

Finally admitting that one of their donors is avoiding UK tax on a massive scale, and pointing out that others do the same is not enough to excuse it. The second part simply means that Labour also have questions to answer; it's absolutely no reason to condone the practice.

After all that's happened recently, it just amazes me that they still don't get it. They really don't seem to understand why anyone would think that there's anything at all wrong with someone who avoids paying UK tax on most of his income sitting in the UK legislature and using his money to influence the results of a UK election.