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Prince Charles tax affairs 'must be investigated'

MPs demand probe into Duchy of Cornwall

Senior MPs yesterday demanded a Treasury probe of Prince Charles's business empire amid claims of murky self-reporting and tax dodges on the heir's estate.

Commons public accounts committee chair Margaret Hodge condemned the veil of secrecy shrouding the heir to the throne's affairs and a sweetheart deal with the Treasury that allows him to choose his own tax contribution.

The heir to the throne's sprawling Duchy of Cornwall portfolio spans commercial real estate, electricity production and sales of marmalade and designer furnishings.

Its profits go to the prince and totalled some £19 million last year, the duchy refuses to pay corporation or capital gains tax despite being Britain's third-largest landowner with 53,154 hectares in 24 counties.

Prince Charles aide William Nye told the MPs that the prince "voluntarily" pays income tax but that since all the cash goes straight to the royal heir it would be unfair to have to do so.

But Labour's Ms Hodge condemned the cosy arrangement, complaining that even the prince's declared income tax was not clear because he writes off his retinue of staff, his lifestyle and even his home as "business expenses."

Treasury officials had simply accepted the royal's income tax declarations at face value, she said.

Ms Hodge said it was clear greater transparency was needed and added that the tax exemptions could be giving the prince's projects an "unlevel playing field."

University of Essex professor of accounting Prem Sikka told the Morning Star the duchy's argument rested on privilege.

"It's a bit like saying an entrepreneur pays tax, therefore his business shouldn't pay tax.

"It's not just like it was in ancient times, that he has a bit of forest land for hunting and fishing and so on - he's actually in business, and that business increasingly has the appearance of a corporation.

"In some ways this is representative of all the issues in the City of London - of antiquated institutions being used as an unofficial tax haven - that are at the root of all the inequalities we've got in the UK today," he said.


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