Crickhowell: Welsh town that took on the taxman sets its sights on the Tories

Crickhowell accuses peer of trying to neuter criticism of Osborne in TV documentary

The Welsh town of Crickhowell, which has "moved offshore" to avoid paying tax. (Andrew Fox)

A Conservative peer has provoked an angry reaction after advising shopkeepers in Crickhowell, the small Welsh market town that rose to national prominence when its businesses decided to set up their own offshore tax avoidance scheme, to tone down their criticism of George Osborne.

Lord Crickhowell, who served as Secretary of State for Wales in Margaret Thatcher’s cabinet, was accused by one local businessman of trying to “keep the peasants in check” by suggesting in a series of emails that the group should steer clear of criticising the Chancellor as they try to expand their protest into a national campaign.

Steve Lewis, who runs the town’s Number 18 Café alongside his wife Sam, told The Independent he had resisted the lobbying from the Tory peer, who he described as “part of the establishment”.

The café is one of the businesses taking part in The Town That Took On The Taxman, a documentary due to air on BBC2 next Wednesday.

Lord Crickhowell, 81, contacted Mr Lewis and another member of the group in December after the town’s tax protest attracted national attention. In an email, he said they were making a “strategic mistake” in attacking Mr Osborne’s failure to close tax avoidance loopholes in the UK and advised them to withdraw their criticism “before it is circulated any more”.

“He is not your enemy but an ally looking for support and ammunition to win a battle with hugely hostile and powerful forces,” the peer wrote of the Chancellor. “George has inherited a tax system with all its complications and absurdities and is faced, as you are, by the corporations with their lawyers and accountants... your object should not be to fight George Osborne but to join as allies in a battle in which your objectives are identical.”

The email drew a sharp response from Mr Lewis, who said the Chancellor was the campaign’s “ultimate target”. He added: “Cosying up to George Osborne is not where we want to be... no intelligent man could possibly defend me paying eight times the tax of Facebook, but he has this issue well on the back burner. He has no appetite for this fight and has kicked it into someone else’s field.”

In a second email, Lord Crickhowell said he was surprised by the “intemperate” response to his advice and suggested that he would be unable to secure a debate on tax avoidance in the House of Lords unless the group changed its tactics. “What would throw a spanner in the works, cause me embarrassment and set your cause back would be an attack on the Chancellor from you to coincide with the debate and BBC launch,” he wrote. “If that is your intention I will not waste any more time.”

Lord Crickhowell also visited the town to hold a meeting with Mr Lewis and other members of the group. “It was clear to me that he was on a fishing trip – he was there as a Conservative grandee, thinking: ‘This guy’s going after George Osborne, let’s see if we can nip it in the bud’,” Mr Lewis said. “I found him incredibly condescending. It was a pat on the head, ‘You don’t understand how the big game works’.”

The café owner said that while some of the other local businesses might see the BBC programme as the end of their fight, for him it was “only the start”. He intends to take the campaign to the courts if necessary, even if in doing so he loses the support of the town’s other businesses.

When contacted by The Independent, Lord Crickhowell said he was an “enthusiastic supporter” of the town’s fair tax campaign and denied that he had been trying to defend the Chancellor. “The advice I’ve given has been related to strategy,” he added. “The fact is that the Chancellor is probably as keen as the people involved in the campaign to get to the endgame of dealing with international companies avoiding tax. Push him, push him hard, but don’t regard him as an enemy.”

He added that during his time in Crickhowell he had also been informed about the administrative burden faced by small businesses, an issue he has since raised with the Government. “I’m entirely behind them – and actually have taken action to see that the points go to an appropriate minister,” he said.