Thousands of protesters gathered in London yesterday morning, calling on David Cameron to close tax loopholes or resign. The ‘Resign Cameron’ protests came at the end of a bad week for Cameron. The Panama Papers scandal unveiled that Cameron’s father, Ian Cameron, ran a Panama-based off shore investment fund that avoided paying tax in the UK. After three days of trying to avoid the scandal, the Prime Minister admitted to owning shares in the fund.
The start of a bad week began for Cameron last Monday, after The Guardian reported on the Panama Papers, a set of 11.5 million confidential files leaked by a Panama law firm Mossack Fonseca, which revealed the activities of over 214,000 offshore companies. The Panama Papers revealed that David Cameron’s late father, Ian Cameron, was a director of the offshore investment fund Blairmore Holdings Inc. which has avoided paying any tax on its profits in the UK since it was founded in the early 1980s.
When first quizzed about David Cameron’s knowledge or involvement in the fund, Cameron’s spokeswoman said: “That is a private matter” and explained that Cameron had, “taken a range of action to tackle evasion and aggressive tax avoidance”.
Cameron had made his best efforts to avoid answering questions regarding the scandal at the beginning of last week, with Downing Street making various statements, such as: “To be clear, the Prime Minister, his wife and their children do not benefit from any offshore funds. The Prime Minister owns no shares. As has been previously reported, Mrs Cameron owns a small number of shares connected to her father’s land, which she declares on her tax return.”
It was not until last Thursday, three days after The Guardian reported on the Panama Papers, that Cameron admitted to profiting from his father’s fund. In an interview with ITV News Political Editor, Robert Peston, Cameron revealed that he and his wife owned shares in his father’s offshore investment fund before selling them for around £30,000 in 2010.
The Prime Minister exclusively told ITV News that: “We owned 5,000 units in Blairmore Investment Trust, which we sold in January 2010. That was worth something like £30,000. I paid income tax on the dividends. There was a profit on it but it was less than the capital gains tax allowance so I didn’t pay capital gains tax. But it was subject to all the UK taxes in all the normal way.”
Cameron went on, stating: “I want to be as clear as I can about the past, about the present, about the future, because frankly I don’t have anything to hide.” He also admitted that it had been, “a difficult few days” after the Panama Papers were released and he and his late father were subject to criticism regarding his tax affairs.
The news of Samantha Cameron’s pricey adviser created even more public anger for Cameron last week, with many believing that he has been misleading with his tax affairs. This was one of the motives behind the ‘Resign Cameron’ protests that took place in London yesterday.
It was reported that up to 5,000 protesters gathered outside of the hotel where the Conservative Party’s spring forum was taking place on Saturday. Afterwards, the protesters headed back to Downing Street. They were calling for Cameron to “resign” or “close tax loopholes.”
An article by The Mirrorpublished earlier today, questions whether Cameron will pay tax on the £200,000 given to him by his mother in 2011 after he received £300,000 inheritance from his father in the previous year. The article questioned whether the separate payment of £200,000 was another attempt at tax avoidance. Had his father left him a full £500,000 sum, it would of crossed the £350,000 inheritance tax threshold and Cameron would be subject to pay £70,000 in tax. Instead, Cameron does not have to pay tax on the ‘gift’ from his mother at present, unless she passes away before 2018. This is due to the ‘seven-year rule’ involved in inheritance tax.
It seems that this is not the end for Cameron and his questionable financial affairs. Whatever your view on tax avoidance is, no one can deny that it has definitely been a bad week for the Prime Minister.