Robinson plans a tax crackdown - on himself

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The Independent Online
Geoffrey Robinson, the millionaire businessman turned Treasury minister, is helping craft a new law on tax-avoidance dodges - action that will add to his own tax bill. With the political storm still rumbling over his own family's offshore trust, Anthony Bevins, Political Editor, reveals the latest twist in the saga.

Tony Blair believes Mr Robinson has done no wrong and is determined to keep him. The Independent has learnt Mr Robinson is playing a discreet but influential role in the Treasury - helping to plug the tax leaks exploited by businessmen like himself.

As Paymaster General, he has no direct tax responsibilities apart from a review of corporation tax. However, he has intervened to guide colleagues on the ins and outs of tax avoidance - advice that will increase his own eventual tax liabilities, possibly by opening up the revenues from his Guernsey-based family trust to UK tax.

A Treasury source told The Independent last night that he had seen highly confidential internal working papers which showed Mr Robinson's contribution to a new crackdown expected in next spring's budget. A Treasury spokesman said last night: "Personal tax matters are the responsibility of the Financial Secretary, Dawn Primarolo, and the Chancellor makes all the final decisions."

But a Treasury insider confirmed the minister's role on work against tax avoidance, adding: "Geoffrey's decades of business experience have provided useful insights, not just with the highly successful windfall tax - but more widely."

Gordon Brown, Chancellor of the Exchequer, said in his first budget, in July: "The tax burden avoided by the few falls on the many." He then announced plans to curb tax abuses that will raise pounds 1.7bn over four years.

He also told the Inland Revenue to review all tax avoidance, including the Revenue's approach to "the defeat and deterrence of tax-avoidance schemes." Mr Brown said in a written Commons reply on Friday: "Both the Inland Revenue and Customs and Excise are also looking at the possibility of introducing a general anti-avoidance rule." Such a rule could make tax avoidance, like tax evasion, illegal. In the Commons yesterday Betty Boothroyd, the Speaker, told Tory MPs not to "abuse and use" House proceedings to get at Mr Robinson after Peter Lilley, the shadow chancellor, had complained that while he was refusing to answer parliamentary questions he was giving interviews to Sunday newspapers.

Mr Lilley said earlier that new evidence had confirmed three charges against Mr Robinson - "charges of hypocrisy, of a conflict of interest and of being economical with the truth. He must start to give straight answers to the House of Commons - not half the story to selected journalists."

Specifically, Mr Lilley said the Robinson family's Orion Trust had been set up after Labour had published its 1994 policy statement, "Tackling Tax Abuses". He asked whether Mr Robinson had been involved in setting up the trust, and, if so, whether he had been aware he was acting against party policy. Malcolm Bruce, the Liberal Democrat spokesman, said: "This offshore tax loophole must be closed - immediately - in order to draw a line under this matter and to deliver the Government's pledge to stamp out tax avoidance." But he joined Labour MPs in attacking the Tory stance, pointing out that during 18 years in office they had done nothing about tax loopholes.

The Prime Minister's spokesman said Mr Robinson had done nothing wrong, and all the transactions relating to the trust had taken place before he became a minister. "There is nothing that has been stated or proven amongst the swirl of coverage that merits Geoffrey Robinson resigning," he said. "The first principle is that the Prime Minister - nobody else - will decide who is in his government. The second point is that he builds a government based upon a variety of skills and background and insight and expertise that we require in a government.

"He believes Geoffrey Robinson has brought and continues to bring an expertise in the world of business that gives us an added dimension in government, which has already borne fruit in relation to the windfall tax, some of the discussions we have had on coal, the public-private finance arrangements John Prescott is trying to put together." The spokesman said there was no question of the Prime Minister succumbing to media pressure for Mr Robinson to be hounded out of office.