Status anxiety

Another year, another tax leak – and the usual annual festival of hypocrisy

11 November 2017

9:00 AM

11 November 2017

9:00 AM

Stories about members of the establishment using offshore tax shelters — ooh er missus! — come along about once a year, thanks to the efforts of the liberal media. Cue a chorus of disapproval from Jeremy Corbyn, Vince Cable, Margaret Hodge and other left-wing panjandrums who demand that the government ‘seize’ Britain’s overseas territories and ‘clamp down’ on tax loopholes. Then, as night follows day, it emerges on the Guido Fawkes website that a large number of these sanctimonious prigs are themselves direct beneficiaries of offshore tax arrangements — and the kerfuffle over the Paradise Papers is no different, as I will shortly make clear. It’s like an annual festival of hypocrisy.

The Guardian has been leading the charge this week, as it always does, conveniently ignoring the fact that the Scott Trust, which owns the paper, was originally set up by the Scott family to avoid paying death duties, as well as the fact that the Guardian Media Group took advantage of a murky web of tax shelters in the Caymans to avoid paying a penny on the £300 million it earned from the sale of Auto Trader in 2008. It is nothing short of miraculous that the Guardian’s reporters, when sifting through the latest cache of leaked documents, did not stumble across their own paper’s name alongside Lewis Hamilton’s and the cast of Mrs Brown’s Boys. Luckily, they did not, which allowed the paper’s head of investigations to thunder away about ‘offensive’ and ‘unfair’ tax avoidance in a tub-thumping editorial last Monday.

When it comes to not practising what you preach, the Guardian takes the biscuit but the Mirror comes a close second. It went to town earlier this week on those it labelled ‘tax dodge parasites’ and ‘exposed’ the ‘tax secrets of the wealthy’ including various members of Trump’s cabinet. Weirdly, this doughty custodian of public morals overlooked the fact that Appleby, the offshore tax specialists at the centre of the Paradise Papers leak, looks after the ‘employee benefit trust’ of… yes, you guessed it, Trinity Mirror.


Then there’s the Labour party which, don’t forget, rents its London headquarters from an offshore property trust. Earlier this week, Jeremy Corbyn demanded that the Queen apologise for using overseas tax havens to avoid paying tax in the UK. Let us gloss over the fact that the Queen is not legally obliged to pay any income tax and therefore cannot, by definition, be guilty of avoidance. Instead, just focus on the fact that John McDonnell’s five-figure annual pension is managed by a global equity company based offshore. As the Shadow Chancellor said: ‘There has been one rule for the rich and another for the rest of us.’ Quite so, John. You just seem a bit confused about which category you belong to.

As for Margaret Hodge, Labour’s most ferocious critic of tax evasion, she received £1.5 million when a family trust in Lichtenstein was wound up in 2011. Three-quarters of the shares in the trust had previously been held in Panama, which Hodge has described as ‘one of the most secretive jurisdictions’ with ‘the least protection anywhere in the world against money laundering’. You could not make it up.

However, ‘star of the week’ must go to Jolyon Maugham QC, the arch-Remainer who tried, unsuccessfully, to take the Government to court in Ireland to derail the Brexit process. ‘Patriotic isn’t about a poppy,’ he tweeted last Monday. ‘Patriotic is about paying your taxes so your country can educate its children and care for its elderly.’ Could this be the same Jolyon Maugham who, in his capacity as a tax barrister, represented seven wealthy individuals in the latest round of their long-running battle with HM Revenue and Customs last month?

When I tweaked Maugham’s nose about this on Twitter, he fell back on the ‘cab rank’ rule, i.e. he is professionally obliged as a barrister to represent the first client in line and cannot be held responsible for their actions. Yes, Jolyon, but presumably the reason you were behind the wheel of that cab is because you’re a barrister who specialises in income tax? I think of this as the pious gunfighter’s defence: ‘Admittedly, I trained to defend people I morally disapprove of, but because they are in a fight by the time I come along my conscience is clean.’

When I hear people like Jolyon roaring away from atop their high horses, I think of that quote attributed to Reinhold Niebuhr: ‘Frantic orthodoxy is never rooted in faith but in doubt. It is when we are unsure that we are doubly sure.’

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