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Vince Cable's crackdown on tax havens may upset some Lib Dem donors Vince Cable's crackdown on tax havens may upset some Lib Dem donors
(about 1 hour later)
Vince Cable's pledge at the Liberal Democrats' autumn conference to work with allies to close down tax havens may not go down well with two of the party's most generous corporate donors.Vince Cable's pledge at the Liberal Democrats' autumn conference to work with allies to close down tax havens may not go down well with two of the party's most generous corporate donors.
The business secretary told delegates he would crack down on those who used secretive, low tax jurisdictions: "No one keeps their cash in tax havens for the quality of investment advice; these are sunny places for shady people," he said.The business secretary told delegates he would crack down on those who used secretive, low tax jurisdictions: "No one keeps their cash in tax havens for the quality of investment advice; these are sunny places for shady people," he said.
Alpha Health Care and its sister company C & C Health Care, part of a venture capital group in the private health sector, have together donated £970,000 to the Lib Dems since 2004. Alpha's parent company, Harberry Investments, is based in a small office in Tortola in the British Virgin Islands – named as a tax haven by Congress in the US. Alpha Healthcare and its sister company C & C Alpha Group, part of a venture capital group in the private health sector, have together donated £970,000 to the Lib Dems since 2004. Alpha's parent company, Harberry Investments, is based in a small office in Tortola in the British Virgin Islands – named as a tax haven by Congress in the US. Bhanu Choudhrie, a director in both donor companies, has also given a personal donation of £35,000 to the party. His father, Sudhir Choudhrie, who was once involved as a director of companies in the Alpha group but has now stepped down, has given a further £95,000 to the party since 2006.
Bhanu Choudhrie, a director in both donor companies, has also given a personal donation of £35,000 to the party.
His father, Sudhir Choudhrie, who was once involved as a director of companies in the Alpha group but has now stepped down, has given a further £95,000 to the party since 2006.
The Choudhrie family, originally from India, was first introduced to the party by Simon Hughes, the Lib Dem MP for Bermondsey in south London.The Choudhrie family, originally from India, was first introduced to the party by Simon Hughes, the Lib Dem MP for Bermondsey in south London.
Both Choudhries said in 2010 that they were domiciled outside Britain for tax purposes. If this is still the case, they can, if they wish, avoid British tax on any income or gains from their overseas assets. Both Choudhries said in 2010 that they were domiciled outside Britain for tax purposes. If this is still the case they can, if they wish, avoid British tax on any income or gains from their overseas assets.
Contacted on Monday, one of the company's directors, Dhruv Choudhrie, declined to comment on Cable's speech, saying he was abroad. A spokesman for the company did not respond to emails or telephone calls.Contacted on Monday, one of the company's directors, Dhruv Choudhrie, declined to comment on Cable's speech, saying he was abroad. A spokesman for the company did not respond to emails or telephone calls.
Some senior Lib Dems have maintained close links to offshore havens. Lord Razzall, a former Lib Dem trade and industry spokesman, sits on the board at a firm called Ardel Holdings. The company is based in Guernsey and offers services including tax mitigation for clients, promising that "income can be rolled up tax free". Some senior Lib Dems have maintained close links to offshore havens. Lord Razzall, a former Lib Dem trade and industry spokesman, sits on the board at a firm called Ardel Holdings. The company is based in Guernsey and offers services including tax mitigation for clients, promising that "income can be rolled up tax free". Ardel helps with tax mitigation through "fiduciary structuring" for businesses and individuals. It also helps non-domiciled UK residents exploit non-taxable offshore funds.
Ardel helps with tax mitigation through "fiduciary structuring" for businesses and individuals. It also helps non-domiciled UK residents exploit non-taxable offshore funds. Its website says: "The benefits and flexibility delivered by offshore companies make them a highly attractive option for clients." Its website says: "The benefits and flexibility delivered by offshore companies make them a highly attractive option for clients."
Razzall said: "As an adviser to the owner of Ardel Holdings for the last 25 years I have always been satisfied that the business does not engage in activities of the type criticised by George Osborne."Razzall said: "As an adviser to the owner of Ardel Holdings for the last 25 years I have always been satisfied that the business does not engage in activities of the type criticised by George Osborne."
The former Liberal leader Lord Steel is a non-executive director of General Mediterranean Holdings, a Luxembourg-established company set up by Nadhmi Auchi, an Iraqi-born billionaire. Steel said the company's headquarters were in Luxembourg and it held most board meetings there.The former Liberal leader Lord Steel is a non-executive director of General Mediterranean Holdings, a Luxembourg-established company set up by Nadhmi Auchi, an Iraqi-born billionaire. Steel said the company's headquarters were in Luxembourg and it held most board meetings there.
The party's largest ever corporate donation came from the company of the convicted thief Michael Brown, who is in prison after going on the run for three years. A spokesman for the Liberal Democrats said: "Liberal Democrats are committed to targeting companies and individuals who are using aggressive tax avoidance measures by hiding money off shore. In some cases, there are legitimate reasons for global companies to not base themselves in the UK, and even corporations such as the Guardian Media Group have on occasion used the Cayman Islands.
He gave £2.4m to the party through his British company 5th Avenue Partners in the runup to the 2005 general election. It later emerged that most of the donation had been transferred from a Swiss bank account. The high court later ruled that his companies were entirely fraudulent and that the money had been stolen as part of a £40m scam to defraud high-rolling investors including the former Manchester United chairman Martin Edwards. Regarding the donations from Alpha and C & C, he added: "They are part of global groups which have UK based businesses, paying full UK tax and employing British workers.
Nick Clegg has declined to repay any of the money to Brown's victims, claiming that the party accepted it in good faith and that it has been spent on posters and advertising. "But as Vince Cable and Danny Alexander have made clear, Liberal Democrats will be cracking down on anyone using tax havens to solely avoid paying a fair share of tax in the UK."