The Guardian reports that David Cameron’s father made his family fortune through a network of offshore funds in countries like Panama and Geneva, which “explicitly boasted of their ability to remain outside of UK tax jurisdiction”.
Ed Howker and Shiv Malik write:
The structure employed by Cameron senior is now commonplace among modern hedge funds, which argue that offshore status can help attract international investors. UK residents would ordinarily have to pay tax on any profits they repatriated, and there is nothing to suggest the Camerons did not.
Nevertheless, the dramatic growth of such offshore financial activity has raised concerns that national tax authorities are struggling to pin down the world’s super-rich.
The news has sparked mixed reaction. The tax campaigner Richard Murphy points out that it leaves the prime minister open to charges of hypocrisy. Despite inheriting £300,000 from his father after his death, Cameron is seemingly against the sorts of practices which were used to earn that money, saying about a general anti-avoidance rule that:
One of the things that we are going to be looking at this year is whether there should be a general anti-avoidance power that HMRC can use, particularly with very wealthy individuals and with the bigger companies, to make sure they pay their fair share.
On the other hand, many have agreed with the sentiment expressed by Sally Bercow, who wrote:
Not liking Guardian front page on Cameron family fortune. At all. Raking around his dead father’s affairs – not on. And Dave is not his dad. Feel a bit sick having read it actually. Am clearly going soft. I say attack Dave, not his late father…
Downing Street is sticking to the latter line, telling the Guardian that it did not want to comment on what was a private matter for the Cameron family.
The problem the Camerons have is that, as the debate over whether or not George Osborne pays the 50p tax demonstrated, wealth is as much a political issue as income. And while the latter can be safely divided between personal income, knowledge of which may be in the public interest, and family income, which isn’t, the former is harder to draw a line through.
Accusations that the prime minister is “out of touch” are fundamentally rooted in his family history and the privilege that it bequeaths him. If examining that history is out of bounds, then the debate is forced to focus more heavily on wealth than income – which can distort the debate.