Fink backs down from threat to sue Miliband over tax avoidance

Tax avoidance row: Ed Miliband (left) and Lord Fink.

Tax avoidance row: Ed Miliband (left) and Lord Fink.

Anybody watching the news last night could have been forgiven for thinking the political headline was that Lord Fink had threatened to sue Ed Miliband for calling him a tax avoider, rather than that David Cameron had avoided answering any questions on the more serious connection between tax avoidance and donations to the Conservative Party.

As this blog reported yesterday, Mr Miliband said to Cameron (during Prime Minister’s Questions): “Let us take Stanley Fink, who gave £3 million to the Conservative party. The Prime Minister actually appointed him as treasurer of the party and gave him a peerage for good measure. Will he now explain what steps he is going to take about the tax avoidance activities of Lord Fink?”

Cameron didn’t answer but Lord Fink threatened to sue the Labour leader, challenging him to repeat the tax avoidance claim outside the House of Commons in a place where he couldn’t claim Parliamentary privilege of exemption from such legal action.

This was a very silly move as we all know tax avoidance isn’t actually illegal. As a former Conservative Party treasurer, Fink should know this.

Presumably somebody turned up to give him some proper advice overnight, as he has now changed his tune, admitting he took “vanilla” tax avoidance measures.

In an interview with the Evening Standard, he tried to justify it by saying: “The expression tax avoidance is so wide that everyone does tax avoidance at some level.”

Is that right? Isn’t there a difference, though, between the cash-in-hand activities of the man on the street and the kind of bank-aided deception described in the HSBC scandal?

What’s the morality of tax avoidance that provides somebody with the spare cash to make a massive donation to a political party and receive a job and a peerage in return?

According to The Guardian, Fink said he “used the opportunity … to set up some simple family trusts” while on a four-year posting to Switzerland. He transferred some shares to his children and his wife.

“Really what I was trying to do was, not like a living will, but to allocate a very small shareholding to each of my children so they could pay deposits on houses in London one day after we returned. There was nothing complex and they weren’t aggressive tax planning.

“I chose the mildest end of the spectrum that I was advised on,” he said. “What I did … was at the vanilla, bland, end of the spectrum.

“My family and I paid tax on all the dividends, both in Switzerland and the UK. They were done because my children were under 18 and I wanted them to have something to help them make their way in the wider world.”

Lord Fink is a multi-millionaire. It is unlikely that his children will ever be short of a few bob.

Meanwhile, one is left to wonder how many ordinary working people Fink believes get this kind of tax advice from their own bankers.

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10 thoughts on “Fink backs down from threat to sue Miliband over tax avoidance

  1. caldy2jess

    An unfortunate name is Fink..

    Especially when you have just grassed up all (?) of your business assiciates to HMRC

    ” everyone does tax avoidance at some level.”…”

    Will he be the next tory to jump a sinking ship to the kippers?

  2. Florence

    “Cash in Hand” is tax evasion (illegal) for the poor. HSBC was helping hide rich peoples money from the tax man, also ILLEGAL. Tax avoidance through trusts, swiss bank accounts, legal but only available to those (all of us apparently “Fink”) who are wealthy enough to have help to arrange matters and spare cash to avoid tax, which is legal, but may be ethically challenged. The normality of this state of affairs is indicative of how far the establishment has not only arranged itself to be the main beneficiaries of the wealth produced by actual working people, including state & EU hand-outs, but also of tax rules that favour them keeping as much as possible away from the tax man. Dave Hartnett took this to new levels for corporate taxation.

    HSBC, PwC, Deloitte, other accountancies have pedalled “aggressively” tax products that are borderline (or worse) between avoidance and evasion. One of the biggest scams is the non-dom tax bracket – exclusive to the UK – that can be inherited, that allows money to be moved to avoid tax anywhere in the world.

    1. Michele Witchy Eve

      The BBC red button, Business and Markets section, reported on 11.2.15 that PwC is presently advising global oil firms to “transform” the way they operate (due to falling oil prices etc.) by reducing their costs “in a substantial manner”, and advises “keeping tax costs in control”. How would your readers interpret that advice, Mike?

  3. Levinas

    “What I did … was at the vanilla, bland, end of the spectrum.’, 50 Shades of Tax Avoidance? ‘Bout time he had a whipping from HMRC then.
    “My family and I paid tax on all the dividends, both in Switzerland and the UK. They were done because my children were under 18 and I wanted them to have something to help them make their way in the wider world.”, and yet when ordinary citizens, who pay income tax and VAT plus lord knows what else to get blood from the proverbial stone, apply for the benefits their taxes have paid for, they jump through hoops to be turned down so would this toff defence be ok when the kids are starving, to say to the courts, ‘it’s not really fraud is it? I only claimed because the kids are under 18 and I wanted to put food on the table instead of them going to school with empty bellies again’ Or would it be the case that the ordinary citizen, putting food into starving kids bellies would be subject to dawn police raids for three figure sums but Fink n Friends would be applauded in the House and left to sleep soundly whilst scamming the system for the price of a few UK house deposits.

  4. A-brightfuture

    So this is what they meant when Cameron said “WE ARE ALL IN IT TOGETHER”.

    The look on Cameron’s face when Ed gave him a grilling. It reminded me of a teenager getting caught smoking behind the bike shed.
    What a complete joke this government is.

    Arthur Daley and Del Boy could run this country more honestly.

  5. John Gaines

    I wonder why he actually admitted his criminal Tax dodging? expect to see an Fink expose in the Sundays’

  6. Mr.Angry

    Despite all the comments don’t we the public need to see justice done, this is going on more and more as the years go by and who takes the wrap and suffers, we the peasants.

    Get Margaret Hodge on the job and a high court Judge who isn’t influenced by the Tory back stabbers or warned off by the hand shake.

    This can’t be left to rest something desperately needs doing and now not five years down the line.

    How can a criminal get a peerage is beyond comprehension ????????????

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