Ashcroft Under Pressure To Clarify Tax Residence

by Amanda Banks, Tax-News.com, London

13 February 2008

UK Conservative Party leader David Cameron, has reportedly told Lord Ashcroft, a major party donor, to reveal his tax residency status or risk losing his seat in the House of Lords.

According to reports in the UK media, Cameron recently met Ashcroft to seek clarification of his tax affairs, as pressure grows on the Tory leader to reveal whether Ashcroft, who is also Deputy Chairman of the party, is resident in the UK for tax purposes.

Ashcroft has major business interests in Belize, but he has never fully disclosed details of his tax affairs, despite this being a pre-condition of his peerage, which was awarded to him in 2000. Ashcroft has supposedly given the Tory leadership assurances that his tax affairs are in order, but has refused to divulge any details publicly, which has merely served to fuel speculation that he has something to hide.

However, after a string of financial and donation scandals which have rocked both the governing Labour Party and the opposition in recent weeks, the Tories are throwing their support behind new legislation proposed by Lord Oakeshot, a Liberal Democrat, which seeks to ensure that serving peers and members of parliament are UK tax residents.

Lord Strathclyde, the Tory leader in the Lords, told the Mail on Sunday that Ashcroft gave several assurances regarding his tax status when he accepted his peerage, but he added that: "If legislation is brought forward to ensure that UK legislators pay taxes in this country, then my party will support it."

Lord Strathclyde went on to tell the paper that: "If he (Ashcroft) is not a UK taxpayer then he and every other peer in that position would have to give up their seats in the Lords."

A spokesman for Ashcroft told the Guardian newspaper that any change in the law regarding the tax residence status of peers would "have no effect on him", but refused to comment further on his tax affairs.

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