Lest We Forget

Old news is swiftly forgotten so just to remind you……

The children of former UK prime minister Margaret Thatcher will avoid paying millions in inheritance tax because their mother’s house in Belgravia, London, is registered to an offshore trust.

Thatcher, who died in April, left £4.7 million to her family in her will, with a third each going to her children Mark and Carol, and the remaining third to be shared between her grandchildren when they reach 25.

Not mentioned in the document is the house in Chester Square, recently valued at £12.5 million by Zoopla, which Thatcher lived in for the last decades of her life, reports the Mirror.

Under UK law, those who inherited the property to would have had to pay inheritance tax of 40% of its value, or up to £5 million, if it were registered as belonging to a UK resident.

The house was bought in 1991 by Bakeland Property Ltd, which was then based in Jersey, and then sub-leased to a firm of the same name registered in the British Virgin Isles, another offshore tax haven.

John Christensen, of the Tax Justice Network, said: “There are huge financial benefits for an offshore company to own a property or leasehold, particularly in connection with stamp duty and inheritance tax.

Campaign group Republic has called on MPs to launch a full-scale investigation into the royal expenses scandal. The call follows reports that Prince Andrew is demanding more money from the taxpayer, to fund his daughters’ lifestyles.

Republic’s CEO, Graham Smith, has said today:

“The taxpayer does not owe the royal family an income at all.  We need an end to royal abuse of public funds – let’s put the Queen on a salary and fund a small office for the head of state. The rest of them can pay their own way”

“Andrew seems to think the taxpayer are there for his benefit and to feather his family’s nest. At a time of serious economic uncertainty the last thing we need is a grasping, greedy royal demanding more of our cash.”

THE most memorable incidents in earth-changing events are sometimes the most banal. In the rapidly spreading scandal of LIBOR (the London inter-bank offered rate) it is the very everydayness with which bank traders set about manipulating the most important figure in finance. They joked, or offered small favours. “Coffees will be coming your way,” promised one trader in exchange for a fiddled number. “Dude. I owe you big time!… I’m opening a bottle of Bollinger,” wrote another. One trader posted diary notes to himself so that he wouldn’t forget to fiddle the numbers the next week. “Ask for High 6M Fix,” he entered in his calendar, as he might have put “Buy milk”.

What may still seem to many to be a parochial affair involving Barclays, a 300-year-old British bank, rigging an obscure number, is beginning to assume global significance. The number that the traders were toying with determines the prices that people and corporations around the world pay for loans or receive for their savings. It is used as a benchmark to set payments on about $800 trillion-worth of financial instruments, ranging from complex interest-rate derivatives to simple mortgages. The number determines the global flow of billions of dollars each year. Yet it turns out to have been flawed.

At 9.29 on the morning of Thursday, December 2, a relatively innocuous-looking announcement was published by the Financial Services Authority (FSA). The note informed those that read it that the UK’s main banking regulator had closed its investigation into the collapse of the Royal Bank of Scotland.

It was 304 words long. The FSA said that it had found no regulatory fault in the actions of the RBS board or its senior managers and that the bank’s near collapse, an event only prevented by £45bn in direct taxpayer support and several hundred billions of pounds of state-backed loan facilities, was simply the result of “bad decisions”.

Such a short announcement on one of the biggest corporate collapses in global financial history might have been hard enough for the country to stomach, but there was one additional sting left in the tail – none of the report would be made public. Indeed, the FSA’s chairman, Lord Turner, declared there was in fact no actual report after nearly 19 months work at a cost of £7.7m.

For politicians, including the Chancellor, George Osborne, the Business Secretary, Vince Cable, and the Treasury Select Committee chairman, Andrew Tyrie, the response was immediate – it was quite clearly not enough

The issue was simple. The public had bailed out RBS and they deserved an explanation that ran to more than 12 sentences.

Shares tumble as Britain’s biggest supermarket chain suspends four executives after profits were inflated by £250m –

Tesco has been plunged deeper into crisis after it was forced to suspend four senior executives and call in investigators following the discovery that its profits had been artificially inflated by £250m.

More than £2bn was wiped off the value of Britain’s biggest retailer on Monday after its new chief executive told the City that forensic accountants and lawyers had been drafted in to scrutinise its books in the wake of a warning from a whistleblower that payments from suppliers were being misbooked and business costs were being glossed over. Tesco said the changes had misleadingly boosted profits by £250m in the first six months of the year.

The retailer, which banked £1.6bn profit in the first six months of 2013, is now expected to make half that this year. The seriousness of the situation meant the figure could fall further still.

One of the four men suspended was Chris Bush, the most senior executive outside the Tesco boardroom as the manager who oversees its UK operations, which rang up sales of £48bn last year. “We have uncovered a serious issue and have responded accordingly,” said Tesco’s chief executive, Dave Lewis, who admitted he did not yet know whether the practice had been going on for some time.

Taxpayers coughed up more than £7m last year helping to subsidise Parliament’s bars and restaurants, a Freedom of Information request has found.

But the taxpayer did have to contribute around £600,000 less than in 2011-12.

But in response to a freedom of information request, the authorities revealed that without that income the operation ran a deficit of £4.9 million in 2012-13.

That was down from £5.5 million the previous year.

Meanwhile the House of Lords said that, excluding revenue from functions and retail sales, its eight catering outlets cost £2.3 million. That was a reduction of around £18,000.

Prices in the Commons were increased this month in an effort to reduce the burden on the public purse.