Lord Ashcroft has long been a person of controversy, partly due to the opaque nature of his affairs in the tax haven of Belize, partly also due his non-domiciled tax status in the U.K. where he is a voting member of the House of Lords, and also because of his financing of the Conservative Party during the past decade to the tune of over £11 million.
According to the Guardian, Panorama will disclose how Lord Ashcroft avoided millions of inheritance tax by transferring shares to a trust created for his children.
The BBC programme Panorama will report tonight that the peer, who steps down from his party role today, transferred the ownership of his main UK company, the Impellam Group, on 5 April. The 64-year-old peer transferred shares worth £17m in the company to a trust to benefit his children. The following day, a law came into force compelling all members of the Lords and Commons to be registered in the UK for tax purposes and pay tax on all their worldwide income. The law had been in large measure prompted by the controversy over his tax status.
Tax lawyer Richard Frimston is quoted telling the programme that Lord Ashcroft would have faced a large inheritance tax bill under the new legislation. Frimston said: "If that had been done on the following day, assets worth say £17m going into trust would have been subject to tax at 20%, which would have created an immediate inheritance tax charge of something in the region of £3.4m. So that was avoided by doing it on 5 April as opposed to waiting until 6 April."The British government has committed itself to create a fair tax system. Abolishing the non-dom rule entirely is a starting point. It should also take steps to prevent those who do not disclose the origins of their funds from funding political parties. As Britain heads for drastic cuts in public spending combined with tax hikes for ordinary people, the government needs to understand that Britain's tax haven status for the ultra-rich looks both unfair and harmful to democracy.