Industry | 2009.12.12
Zac Goldsmith 'avoided £5.8m in tax'
Zac Goldsmith, David Cameron\'s green adviser, challenged to reveal tax returns over use of non-dom status
Zac Goldsmith, David Cameron\'s green adviser and a prospective Tory MP, has been accused of avoiding the payment of nearly £6m in tax during the past 10 years by adopting non-domiciled status.
Goldsmith, the prospective Conservative candidate for Richmond Park, is estimated to have a personal fortune of at least £200m, inherited from his late father, Sir James Goldsmith.
Goldsmith admitted last month that he had claimed off-shore "non-dom" status. Since the news became public, he has said he has given it up.
However, the Liberal Democrat home affairs spokesman, Chris Huhne, has calculated that Goldsmith is likely to have avoided, at a conservative estimate, around £580,000 a year in UK taxes over the past decade as a result of being defined as a non-dom. Goldsmith, who dismisses Huhne\'s figures as "fantasy", says that the "vast majority" of his income comes to the UK and is taxed here. But Huhne told the Observer that if Goldsmith disputes the figures, he should publish his tax returns to prove it and Huhne would do the same.
The Liberal Democrats estimate that Goldsmith probably brings around 80% of his income into this country. Huhne, himself a wealthy MP with numerous properties, says Goldsmith probably earns a return of around 5% on his fortune, which would equal around £10m a year. If 20% of this remained outside UK tax and was split equally between capital and income, he would save £400,000 a year in income tax (40% of £1m) and £180,000 in capital gains tax (18% of £1m).
Huhne said last night that anyone wanting to become an MP should be fully transparent about tax affairs. "Someone who wants to pass laws about tax in this country ought to pay this country\'s full taxes, and not hide behind the special offshore status of non-doms.
"Zac Goldsmith, even on the most conservative estimates, has avoided vast amounts of British tax by deploying the non-dom tax dodge. If he challenges our estimate of how much tax he has dodged, then I put to him a simple challenge. Publish your tax returns for the past 10 years, and I will publish mine."
When his non-dom status was revealed two weeks ago, Goldsmith said it had offered him "very few benefits" as most of his income came to the UK.
Green groups who have questioned Goldsmith\'s environmental credentials are also asking why businessmen and companies who profit from the oil and gas industries are giving the Tories increasing amounts of cash.
An analysis by the Observer of donations given to the party shows that six companies and individuals who profit from the oil and gas industries have begun to give it money over the past year. In the current quarter, it received a £50,000 donation from "Future Pipe Industries". This firm, registered in Britain, is "headquartered in Dubai" and by headed by a UAE resident, Rami Makhzoumi. He told one newspaper: "In recent years the oil and gas market has been our fastest growing end-market due to the overall level of investment in the sector globally, and especially, in the regions in which we operate."
Majid Jafar, 33, who is from the United Arab Emirates, has given £40,000 to the party over the past year. He is the executive director of a family oil firm, Crescent Petroleum Group, and a member of the board of directors of Dana Gas PJSC. He is also a director of Gulftainer. He previously worked for Shell International in its exploration and production and gas and power divisions.
The party has also received £55,000 in the last year from John Dodd, a founder member of Artemis Capital. More than a third of Artemis\'s "Alpha fund" is invested in oil and gas.
Goldsmith dismissed Huhne\'s figures yesterday as "fantasy" adding that they demonstrated the Lib Dems\' lack of ideas. "If Chris Huhne believes it\'s right to publish his private tax returns, then he should do so. He doesn\'t need my lead.
"The Lib Dem approach is always to smear their rivals instead of giving people reasons to support them positively," he said. "This has been the pattern of their campaign in Richmond Park and every other marginal where they know they are losing the policy arguments."
For more information, please visit
http://www.guardian.co.uk/politics/2009/dec/13/zac-goldsmith-tax
