MPs to investigate Lord Ashcroft's tax deal

The Conservative Party came under new pressure over Lord Ashcroft yesterday as MPs demanded the details of the secret deal under which he managed to avoid tax on his foreign income.

The Public Administration Select Committee will ask the Cabinet Office for the paperwork showing how the deputy Tory chairman's promise to become a "permanent" resident in Britain as a condition of securing his peerage in 2000 was changed to "long-term" resident, which allowed him to be "non-domiciled" for tax purposes. Tony Wright, the committee's Labour chairman, said yesterday: "We intend to invite Lord Ashcroft, as well as others who might have been involved in the discussions, to give evidence. We also intend to ask the Cabinet Office to release any records they hold."

The news comes as a new poll of 100 key Labour-held marginal seats put Labour and the Conservatives neck and neck. The Populus poll carried out for The Times gave both parties 38 per cent of the vote.

A Tory spokesman dismissed the move by the select committee as a "cynical Labour ploy to distract voters from the real issues at the general election".

Last night David Cameron appeared to distance himself from Lord Ashcroft. He told Channel 4's Dispatches programme: "I can't remember when I first met Michael Ashcroft, but let's put it in perspective a little bit. I've totally changed the way the Conservative Party raises money. We have broadened the supply... It's not reliant on just a few millionaires any more." Aides said Mr Cameron had forced Lord Ashcroft, who admitted his "non-dom" tax status last week, to be more open than his predecessors as Tory leader had done.

An email seen by The Independent reveals Labour candidates have been sent "a model letter you can tailor to challenge your Tory opponent and a model press release". The Parliamentary Labour Party (PLP) message says: " For 10 years David Cameron and William Hague have repeatedly said that the undertakings [made by Lord Ashcroft] were being met. So either they were misleading people or they were being misled by Lord Ashcroft. David Cameron has shown extraordinary weakness. If he knew the truth, he should have fired Lord Ashcroft. If not, why was he too afraid to ask Ashcroft the awkward direct question?"

The PLP note claims there is a contradiction between the then Tory leader Mr Hague, who said he found out about Lord Ashcroft's tax status in recent months, and the former Whitehall mandarin Sir Hayden Phillips, who said at the weekend that the Tory leadership agreed the change of wording in the peer's undertaking in 2000.