Blair is legitimately taking advantage of laws allowing him to limit what his companies and partnerships must disclose. \”It is baffling; these accounts make remarkably little sense,\” said accountancy expert Richard Murphy of Tax Research UK, a firm that scrutinises company finances. \”This limited disclosure is not within the spirit of the law. \”
It\’s within the letter of the law which is rather what counts here, isn\’t it?
True, it\’s not quite what Ritchie would like to be the letter of the law but that\’s another matter, isn\’t it?
“It is baffling; these accounts make remarkably little sense,” said accountancy expert Richard Murphy
I have a feeling this would be his response to any set of accounts.
One of the world’s top tax schmucksperts should be able to get the goods on Bliar all right. For this one single occassion good luck to Murphy.
This case just shows what utter b*ll*cks all this ‘spirit of the law’ nonsense is. The law is obviously very clear in this circumstances: no-one is even suggesting that Blair is in any way sailing contravening the law. He is just utilising the law as everyone agrees it is drafted. So to say that the ‘spirit of the law’ is contrary to the actual word of the law, as agreed by everyone who counts (Parliament, HMRC and the legal system), is perverse in the extreme.
Any system of law that allows an individual to capriciously decide that any given law is contrary to the ‘spirit of the law’, whatever the original wording, is a dictatorship.
“Any system of law that allows an individual to capriciously decide that any given law is contrary to the ‘spirit of the law’, whatever the original wording, is a dictatorship.
Which as exactly as Ritchie thinks things should be. With him as the Grand Panjandrum or, de minimis, eminence gris.
“World’s Top Accountant Baffled by Ex-Labour PM.s Accounts”. Is the Murf aware of the concept of Wilful Ignorance?
Edit: should read “no-one is even suggesting that Blair is in any way contravening the law”.
When is this site getting a preview function????
No, for audited accounts there is a “true and fair view” override. If it’s necessary for accounts to deviate from UK GAAP (Generally Accepted Accounting Principles) in order to show a true and fair view, then this must be done – and the reasons for deviation given in the notes. Accounts which don’t show a “true and fair view” are not within the spirit of the law, and therefore not within the letter of it either. This really is a case where the spirit of the law takes precedence.
Jim said “no-one is even suggesting that Blair is in any way contravening the law”.
Aren’t they? I think they’re doing their best, within the scope of libel laws.
The Telegraph reports that his company has £8 million of unexplained “admin expenses”, not counting the £2.3 million of salaries, £500,000 rent and £300,000 office equipment (the last seems to be muddling capital and revenue, but never mind).
Quotes like “It is very difficult to see what these administrative costs could be” seem to be as close as they feel safe in printing to saying “we think he’s stuffed all sorts of things through there that aren’t genuine business expenses”.
And that’s from a City accountant, not Murphy.
Off topic, but I see Delingpole has given your Forbes article a link from his Telegraph blog.
http://blogs.telegraph.co.uk/news/jamesdelingpole/100127634/ha-ha-warmist-losers-for-you-the-war-is-over/
Be interesting to see how much the hits went up by.
pechorin, if that’s the law then that’s the law, no spirit about it.
The one thing that one can be pretty sure of is that the loathsome wee twat has been finagling somehow.
it would be interesting to know if the unnamed City source actually worked for KPMG. otherwise, this is all probably withing tn the bounds of the law. Blair and his wife do not want to risk getting hauled in front of tax commissioners and having their schemes dismantled…do they?
11dearieme – “The one thing that one can be pretty sure of is that the loathsome wee twat has been finagling somehow.”
Although we won’t be sure until the tosser turns up lecturing the rest of us on the need to close more loop holes in the tax system.
Blair cannot be understood, in my opinion, without remembering what Paddy Ashdown said about him – for Blair, it is always true at the time he says it.
Wonder if the £8 million is his ghastly wife’s travelling expenses? You can take the girl out of Liverpool…
@Richard: “Aren’t they? I think they’re doing their best, within the scope of libel laws.”
I think thats the point isn’t it? If people don’t want to say publicly that TB is a tax dodger and breaking the law because they are afraid of libelling him, they can’t be that sure he IS breaking the law then can they? Even the article in the Guardian took great pains to state “Blair is legitimately taking advantage of laws allowing him to limit what his companies and partnerships must disclose” so they aren’t prepared to put their money where their mouths would like to be.
The point is mainly that HMRC are obviously OK with it all, and they are the ones that matter, thank goodness, not RM.
The Artist formerly known as Bambi, has access to top notch financial and legal advice. It would be extremely surprising if he was doing any funny business despite his lack of moral standards.
“It would be extremely surprising if he was doing any funny business despite his lack of moral standards.”
Oh, no. It would be extremely surprising if he wasn’t up to any funny business. Because of his lack of morals. But that’s the difference between “funny business” and “breaking the law”.
Jim (#15) said “The point is mainly that HMRC are obviously OK with it all”
Not obviously yet, because:
a) they probably haven’t even had these accounts yet (year ended 31st March 2011, corporation tax return not due until 31st March 2012);
b) they only examine a small proportion; the chances are his previous ones haven’t even been looked at by a human being;
c) if we want a conspiracy theory, then do ex-PMs get an early ride?
If there is a point in the newspaper articles beyond making snarky comments, it’s probably to try to make sure that (b) and (c) do not apply.
The Sunday Telegraph very clearly clearly implies there is something fishy about Blair’s accounts but puts in a line about how it is in no way illegitimate to presumably cover itself against any unpleasant legal letters.
diogenes: yes, it would be interesting to know the source. Possibly someone at HMRC who would like to get Blair. Who knows, even one of Gordon Brown’s old chums might be stirring the pot.
Based on the original Guardian story about Blair’s business structures (they weren’t trading at the time), it looked more like the motivation was to hide assets from the public than to hide assets from HMRC.
The relevant group of “public” here is probably dominated by contingency-fee lawyers tempted to sue Blair in the US courts for aiding and abetting torture or some such. It would be very unlikely for this kind of lawsuit to succeed, but the Blairs as a couple have always looked susceptible to
a) paranoia about Blair’s political opponents being out to get him
b) shysters peddling borderline-criminal financial schemes.
Given that there is a large industry of shysters selling borderline-criminal schemes for hiding wealth from creditors, the Blairs might be good clients.
to Johnathan Pearce (#19).
It’s highly unlikely to be a HMRC source; as I said at #18, HMRC won’t even have been sent these accounts yet.
The structuring was covered in the press a couple of years ago (and I think Murphy blogged about it at the time, but that was before Tim posted here about Murphy’s own use of family companies, which rather tarnished Murphy’s reputation on that front).
What’s happened now is that the latest accounts have been filed with Companies House (y/e 31st March, filing date 31st Dec), so now they’re public someone has bought a copy and done some digging around.
There’s no inside information being leaked here. Just somone following up the old story about Blair’s companies, paying a pound for the accounts from Companies House, and touting it round a few commentators.
It also has to be said that for a relatively young former PM, who isn’t going to return to his previous profession, it wouldn’t be bad advice to structure his various ventures – advising banks, dictators, politicians, royals and businesses – into separate limited liability vehicles because some of them are bound to go horribly thud. Certainly, you’d want to be careful where you placed anything even notionally charitable (ideally to somewhere where the notional losses will be best useable for tax efficiency!)
To Surreptitious Evil (#22)
No, no. You want the profits in the charity, not the losses, because the charity profits are exempt from tax.
You want the losses to be in the taxable consultancy companies.
So far as I can work out, Blair gets:
· 50% of his PM’s salary, for having been PM (no minimum qualifying period, no contributions required); plus
· Up to 3/40ths of his salary for his time as Leader of the Opposition; that’s equivalent to about an extra 4% of his PM’s salary; plus
· Up to 16/40ths of his MP’s salary (only for years since 1991, when the rules were changed; previously former PMs couldn’t also have a former MP’s pension); that’s equivalent to about another 20% of his PM’s pay.
So that’s about 75% of his PM’s pay, paid as a pension, index-linked (I think to the higher of RPI and increases in the serving PM’s salary), for life, from age 54. For 10 years in the job. Not bad.
There’s office and staff allowances as well, plus security for life.
Now, I don’t begrudge him that; he did the job, he’s entitled to the pension.
But the point of the generous pension for former PMs is apparently “to protect the dignity of the Great Offices of State” (quote from the Office of the Leader of the House).
Which means that we the taxpayers pay him a decent pension for life precisely so that he doesn’t embarrass us all by grubbing in unsavoury places for money. He doesn’t seem to be holding up his end of that bargain.
“No, no. You want the profits in the charity, not the losses, because the charity profits are exempt from tax.”
Where you can only get at them for approved charitable purposes at risk of a criminal offence? Remembering that if the purpose is remuneration of the charities volunteers, then you’re further limited because charities don’t pay dividends!
And these charities are operating where?
Tony Blair Africa Governance Initiative
http://www.africagovernance.org
What one might think one could not possibly say……….but one would imagine that President Alpha Conde’s Guinea government will be extraordinarily grateful for the charity’s support in its hour of need.
im not surprised that Murphy cant make any sense out of a set of accounts.
the “tax expert” completely forgot about a well known and commonly used corporate tax relief when analysing the Guardians effective tax rate……..he didnt apologise for getting that wrong either.