Tax efficiency
When Philip Green – owner of ten top High Street stores including Top Shop and Bhs – kneels before his monarch this week to receive his knighthood, I wonder if the UK’s 180th richest person (HMQ) will have a word with the fifth richest (Sir P) about his taxes. Since 1993 the Queen has voluntarily paid income tax on the income from her private fortune of £270 million. But the newly elevated Sir Philip arranges his £4.85 billion fortune more carefully. The Arcadia and Bhs retail groups which form the bulk of it are owned through a trust based in Jersey which is controlled by his wife Christina who appears to be the sole owner of Arcadia (Burton, Miss Selfridge etc). And she is a resident of Monaco, where there is no income tax. Which is just as well.
In 2005 Arcadia paid her a dividend of £1.2 billion – tax-free. If Christina lived in the UK she would have been liable for tax of hundreds of millions of pounds. Although she is a resident of Monaco, Lady Green is frequently seen with her husband in the UK – she is allowed to spend an average of 91 days a year here without compromising her UK tax status as a Monaco resident – and of course he flies over to see her and the family in Monaco on the Gulfstream 550 jet she bought him for Christmas.
A BBC colleague of mine preparing a Panorama programme on tax avoidance wrote to Philip Green asking for an interview. His lawyer replied that an interview would not be appropriate as Philip Green was not due to pay any tax so he was clearly not avoiding it.
So every time you go into Bhs, Burton, Dorothy Perkins, Evans, Miss Selfridge, Outfit, Tammy, Topshop, Topman, or Wallis spend well, safe in the knowledge that not a penny of the profits will end up in Gordon Brown’s pockets.
I mention this not because I think wealthy folk who are British and effectively live here, whatever the technicalities, should pay their fair share – though of course I do – but because new figures out this week show that the number of pensioners paying tax has risen to more than five million. Some on incomes as low as £100 a week. And all on every penny above £140 a week. Not quite enough to afford the expensive tax lawyers who protect the wealth of the rich from the taxman’s enquiries.
And Sir Philip’s knighthood? For services to retailing. Kerching.
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