Hague 'found out in last few months about Ashcroft'

**4me2** · 4th March 2010

Hague 'found out in last few months about Ashcroft'

Harman calls for questions to be answered over Lord Ashcroft's tax status

Ex-Tory leader William Hague says he found out in the "last few months" that Lord Ashcroft changed an undertaking he made before being granted a peerage. The peer agreed to become a "permanent" UK resident, making it more likely he would pay tax on overseas earnings.
But this was later changed to "long-term resident" - a lesser commitment - after discussions with civil servants.
Labour's David Miliband said the peer should resign and called on Tory leader David Cameron to clarify what he knew.
Following years of questions about his status, Conservative deputy chairman and donor Lord Ashcroft revealed this week that he had been non-domiciled for tax purposes for the past decade.
This means he did not have to pay UK taxes on overseas earnings.
'Tens of millions'
Michael Ashcroft was refused a peerage by the political honours committee in 1999.
The Guardian has published a letter written afterwards by Mr Hague to then Prime Minister Tony Blair, acknowledging that one reason was that he "was a tax exile".
Mr Hague wrote Mr Ashcroft was "non-resident for tax purposes" but told Mr Blair: "He is committed to becoming resident ... This decision will cost him (and benefit the Treasury) tens of millions a year in tax yet he considers it worthwhile."
Mr Ashcroft was given a peerage in 2000 after he signed a letter to Mr Hague promising to "take up permanent residence in the UK again", which would seem to preclude non-dom status.

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But the peer, in a statement earlier this week, said that, after talking to government officials, "the interpretation of the first undertaking of the words 'permanent residence' was to be that of 'long-term resident'".
This was a lesser commitment which would allow non-dom status.
Mr Hague, now shadow foreign secretary, told BBC Radio 4's The World Tonight: "Over the last few months I knew and, after that, of course I was very keen to support him in making that position public."
But Foreign Secretary Mr Miliband told the BBC that Lord Ashcroft's position had become "untenable" and that he should resign.
He said the Conservatives had "taken hard cash from Lord Ashcroft without asking hard questions" and called on them to repay the donations.
"They have known that in fact Lord Ashcroft was a non-dom, but they have not seen fit to tell the rest of us," he said.
"We need to know whether or not David Cameron knew and, if he did, why he didn't relay this critical fact ... to the rest of us."
Rowdy debate
The issue of Lord Ashcroft's tax status dominated a rowdy prime minister's questions session on Wednesday, in which Mr Hague stood in for Tory leader David Cameron.
Labour deputy leader Harriet Harman, replacing Gordon Brown, challenged Mr Hague, saying: "What has happened to the tens of millions of pounds of taxes that the shadow foreign secretary promised would be paid by Lord Ashcroft?"
Insisting Mr Hague and Lord Ashcroft could not "both be right", Ms Harman added: "One of them must go."
But Mr Hague, standing in for Tory leader David Cameron, retorted: "If she wants to discuss the House of Lords, I'm sure she will want to explain the position of [Labour peer] Lord Paul, who was made a privy counsellor after he bought 6,000 copies of the prime minister's book on courage.
"Never has so much been given for so few people to read so many words in vain.
Attacking Labour's record, he said: "People in glass houses shouldn't throw stones."
Inquiry call
The Liberal Democrats have called on HM Revenue and Customs to conduct an inquiry into whether Lord Ashcroft's commitment to take up "permanent residence" in the UK was compatible with his status as "non-domiciled" for tax purposes.
Home affairs spokesman Chris Huhne, who estimates that Lord Ashcroft has saved around �127m over 10 years, asked whether he should pay any back taxes.
The Cabinet Office said on Tuesday that former Clerk to the Crown in Chancery Sir Hayden Phillips had reached an agreement with Tory chief whip James Arbuthnot in 2000 about the interpretation of Mr Ashcroft's undertaking, concluding that his promise to take up "permanent residence" meant he would be a "long-term resident" in the UK.
A Cabinet Office spokesman said: "This was not about tax; this was about residency."

http://news.bbc.co.uk/1/hi/uk_politics/8547087.stm