Should politicians publish their tax returns?

Here’s Tim Farron telling Sky News on Friday that he is going to release his tax return, regardless of whether anyone else does. He said he made his decision because he thought that people had “a right to have their confidence in their leaders enhanced and not further diminished.”

Tim Farron: “I’m Going To Publish My Tax Return”“It’s up to him. I’m going to.” Liberal Democrat leader Tim Farron on whether David Cameron should publish his tax return.

Posted by Sky News on Friday, 8 April 2016

And so, David Cameron has now published his tax return. It doesn’t really tell us anything that we didn’t know already. We discover that he’s a rich man. We discover that he and his wife get more in rent for their Notting Hill home every year than some of our homes are worth. They are getting in more than £7,500 per month.

The Scottish Labour leader Kezia Dugdale published her return yesterday. It’s a bit more familiar to people than Cameron’s, showing her salary and her income from her Daily Record column. She doesn’t actually see any of that latter sum, although she pays tax on it, as she gives it to MND Scotland. She’s a very close friend of Gordon Aikman, formerly research director of Better Together, who was diagnosed with Motor Neurone Disease in 2014. He has raised almost half a million pounds for the charity through his Gordon’s Fightback campaign.

Tim’s will, I’m sure, be pretty unremarkable. The thing is, I’m not sure I feel entirely comfortable with knowing all of this stuff about people. Maybe that’s the traditional British reserve about knowing too much about other’s financial circumstances, but I can’t shake off a feeling that it’s none of my business and I feel slightly uneasy about this being a bit of a slippery slope. Where does this actually end? Will we be demanding medical records? I remember there being an almighty fuss over whether Tony Blair’s youngest son Leo had had the MMR vaccine or not. The Press hassled members of the Blair family in an attempt to get an answer and that was so wrong. Going back even further, I’m old enough to remember John Gummer feeding his young daughter a beef burger at the time when BSE was all the rage.

I can’t help feeling that citizens are entitled to some levels of privacy and I’m not sure that these should be waived just because you are a politician. If there are specific reasons in a particular case to demand extra scrutiny, then the evidence should be dealt with by the relevant authorities at the time. It all feeds the perception that politicians are a crowd of venal self-serving vultures. I’ve spent more than 3 decades working with politicians of all parties and, to be honest, I’ve found the vast majority to be decent people with their hearts in the right place.

Also, tax returns may lull us into a false sense of security. They don’t tell you what’s not being declared, like any money stashed away in tax havens, so it manages to be intrusive and not particularly informative.

I’m also wary of the variants of the “nothing to hide, nothing to fear” arguments coming from the Labour Party primarily. Those words are anathema to any liberal.

There’s also been some discussion of whether an expectation of publication could deter successful people going into politics. If “successful” means rich and privileged people who generally don’t get what life is like for people struggling on low incomes, then that may not necessarily be a bad thing. It might be better if the House of Commons had more people with backgrounds in say, nursing, social care, housing, teaching and mental health support. We might get some more practical and helpful decisions.

Yes, publishing tax returns will write some newspaper headlines for a few days, but it’s not going to resolve the disconnect between politicians and the people they are supposed to represent. Politicians who do all they can to make people’s lives better, who make sure that public services are responsive to need not ideology, will do most to bridge that gap in a much more satisfying way. Every time I’ve done phone canvassing in Westmorland and Lonsdale for whatever sort of election, people, even those who aren’t voting for us, have been quick to volunteer how much they admire their MP Tim Farron or their local councillors because they can see how hard they are working for them. That’s why Tim talks so much about community and community politics, because he acts out what he says about the importance of being embedded in your local community and doing all you can for it.

* Caron Lindsay is Editor of Liberal Democrat Voice and blogs at Caron's Musings

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This entry was posted in Op-eds.


  • Eddie Sammon 10th Apr '16 - 9:23am

    I agree. I’m not comfortable with it either. I’m confident the public are not obsessed with David Cameron’s personal finances as some people seem to be. People hate tax avoidance by the rich, but they blame governments as much, maybe even more than the individual and the whole Blairmore Holdings thing was pre 2010 when the Conservatives weren’t in power.

    I actually think the Lib Dem – Conservative coalition went too far in tax avoidance with the General Anti-Abuse Rule. People should change the specific laws, not just make the process harder in order to deter people from entering it.

    I qualified as a financial adviser in 2010 and when I first joined a firm it was clear that tax avoidance under New Labour was rife. The things I was getting told made me believe that the New Labour era was the “Golden Age” of tax avoidance and Jeremy Corbyn needs to share responsibility for this by supporting the Labour government at the time.

  • We should adopt the Norwegian system, where everyone’s tax returns are available online to every other taxpayer.
    That way, the drug dealers in their 5-bedroom detached houses with a Porsche and a 4×4 in their drive, while only declaring a modest income from the tanning salon they own, can be exposed.

  • Eddie Sammon 10th Apr '16 - 9:55am

    Alan Jelfs has actually come up with possibly a very good idea. We are neglecting the big issues of the day if the country relentlessly focuses on Cameron’s personal finances.

    Paul Walter, banning the 7 year phase out rule on inheritance tax on gifts could also be a very good idea. We need to keep the quick succession rules in place though because if mother dies a few days before her son then the residual of the estate can be taxed twice at 40%, so up to 64% in total.

  • Graham Evans 10th Apr '16 - 10:28am

    I tend to agree that we should adopt the Norwegian system of open disclosure of tax returns for everyone and I see no reason why this should be seen as illiberal or as an attack on personal privacy. However a tax return per se tells you little about a person’s wealth, merely about the income they derive from that wealth. Because information on the sale of houses is already in the public domain, it is already relatively easy to estimate a person’s wealth in respect of any property that they are known to own directly, but it doesn’t tell you anything about other assets such as equities or property held through a company or trust. Moreover, provided you have an income sufficient to cover your needs and desires, you can invest in assets which produce very little income but are likely to yield significant capital gains, and capital gains tax is paid at a much lower level than income tax, even more so since the changes in the rates announced in the last budget. An interesting aside in respect of David Cameron’s tax return is the fact that the Tory Party apparently paid David Cameron £10,000 for his wife to buy new clothes. If I were an ordinary party member paying my subscription out of a modest income I would be appalled by this revelation, bearing in mind how wealthy Samantha Cameron is in her own right.

  • Graham Evans 10th Apr '16 - 10:40am

    @ Cllr Mark Wright “Some of us have been saying for years that IHT should be scrapped and replaced with a “Gift tax” on the recipient.” While this sounds superficially attractive, and would probably work OK in respect of liquid assets, it is far from simple in respect of illiquid assets such as farm land or stately homes. One of the reasons why UK agriculture is in general far more efficient than that of France and Ireland is that inheritance laws have allowed land holdings to be passed to a single individual whereas in France and Ireland the land holdings became smaller and smaller as land was split up through the generations. Similar considerations apply to stately homes of historic importance. Moreover the UK trust system means that the really wealthy can in practice avoid paying inheritance tax on most of their assets. This does help farming estates to remain financially viable, often supporting the maintenance of the associated stately home, but it doesn’t necessarily justify why Zac Goldsmith was able to inherit so much money from his father without the estate paying much by way of inheritance tax, or indeed the Dukes of Westminster continuing to control and indirectly own and derive huge income from much of the prime real estate in London and elsewhere..

  • Yes, I think politicians should publish their tax returns and other financial interests. They are not just ordinary people going about their daily business. They are law makers to an extent our rulers. So they need to be judged to higher standards.
    The suspicion that our elected representative are saying one thing in public and doing something else in private is very bad for democracy, as demonstrated by the expenses scandal. Too much emphasis is placed on whether or not these issues are legal and not enough on whether they are moral. The reality is that different rules do apply to different professions. A professional athletes for instance can be disbarred from competing for taking drugs that are only illegal in context of professional sports because it is seen as giving them an unfair advantage or in other words as cheating. If you are in charge making laws then you should not be able to hide from public scrutiny for the same reason. Every time these sorts of issues comes up there are cries of class envy or that the public are placing unrealistic expectations on elected officials. Well I’m sorry, but the nature of having power should dictate different standards because there is an ability to create self advantaging laws built into the job. In other words there is an opportunity to legally cheat.

  • Every reduction in Politicians privacy is another barrier to ordinary people choosing a career in Politics. Who counts as a Politician anyway ? MPs, Councillors, anyone standing as a “paper” candidate ?
    The question we should be asking is why all The Tory Papers are attacking The Tory PM, could it be something to do with June 23rd ?

  • Rightsaidfredfan 10th Apr '16 - 11:23am

    I don’t believe anyone’s tax affairs should be public. The Norwegian system as someone here advocated is illiberal and a breach of privacy.

    Cameron’s in a different position as people don’t like these offshore arrangements, especially when it’s possible to hide the true owners of things in those offshore locations.

    I guess Tim is showing the public that he has nothing to hide, thing is I don’t think anyone ever thought that Tim was hiding anything.

  • Yes, the sight of the Sunday papers attacking David Cameron’s mother for doing something perfectly legal and normal is rather unedifying. You would have to be a masochist not to use the seven year rule to avoid losing 40% of an inheritance to the taxman and the hypocrisy of the journalists writing these stories is pretty nauseating. However, they are focusing on an easy target rather than asking more fundamental questions about Ian Cameron’s activities. The bank interest that Cameron has declared is interestingly close to 1% of the £300,000 inheritance + £31,000 from the sale of his share of Blairmore Trust. Why anyone would keep a sum of money of that size in the bank with the level of interest that banks pay these days is another intriguing question.

  • Graham Evans 10th Apr '16 - 11:43am

    @ Rightsaidfredfan “Cameron’s in a different position as people don’t like these offshore arrangements, especially when it’s possible to hide the true owners of things in those offshore locations.” Cameron’s problem was not the fact that he owned some units in an off-shore trust but that he gave the impression that he had something to hide. Most people who own unit trusts or OICS, either directly, through and ISA, or in their pension fund, probably own units in a off-shore trust, because this enables the trusts to buy and sell assets and derive income from those assets without paying tax. However, when the income is passed to the beneficial owner of the units based in the UK they pay income tax on that dividend (unless it is held in an ISA or pension fund). Similarly if they sell their holdings at a profit they are potentially liable for capital gains tax. There are some forms of collective investment vehicles – and most people who having savings in equities should use collective investment vehicles rather than direct share holding – which get round the problem of double taxation, but often they are subject to tighter regulations which makes it difficult to invest in companies abroad. I imagine that Cameron chose to own units in the trust run by his father simply because of familiar loyalty. Per se there was nothing sinister in what he did. What is more sinister is the fact that Panama and British dependencies are unwilling to provide HMRC information on British residents who are potentially evading pay tax on income which is subject to UK tax.

  • @tonyhill
    “You would have to be a masochist not to use the seven year rule to avoid losing 40% of an inheritance to the taxman and the hypocrisy of the journalists writing these stories is pretty nauseating.”

    Nobody “loses 40% of an inheritance”. The first £325,000 of any estate can be passed on tax-free.

    David Cameron was perfectly happy to publicly condemn a comedian as “immoral” for taking part in a legal tax avoidance scheme, so the scrutiny being put on his own tax affairs – whether it was all within the law or not – is perfectly legitimate, fair, and not remotely hypocritical. Hearing Tory MPs lining up to say that Cameron has done nothing wrong since “everything was legal” is the only hypocrisy on show here.

    This line that many of us are somehow implicated in the same kind of things doesn’t hold much water. For one thing, how many of us can reasonably be expected to check the legal status of every single investment made by some trust we have a few units in? I have some small investments in such trusts myself, and oddly enough they haven’t returned anything like the amounts Cameron made from Blairmore. It’s almost as if the rich have access to better investment vehicles than the rest of us!

  • Stuart – if you read what I was saying I was attacking the journalists (and by implication the proprietors of their newspapers) for hypocrisy. I am concerned that by going after an easy target, the £200,000 given to Cameron by his mother under the seven year rule which is a perfectly legitimate thing to do (and not, in my view, in any respect comparable to the aggressive tax avoidance of the Jimmy Carr scheme to which you allude) that elements of the story which are perhaps more difficult to uncover and harder to comprehend are being ignored. The story in today’s papers appears to be an effort by Brexit supporting newspaper proprietors (at least one of whom changes nationality to suit his business requirements) to undermine David Cameron. It may be that he has done something wrong and that he is therefore being hypocritical, but no one has produced any evidence to show that.

  • Laurence Cox 10th Apr '16 - 9:09pm

    I noted on “The Andrew Marr Show” today that Jeremy Corbyn was calling for tax transparency, not only for politicians but also for other people in public life, such as TV interviewers. How do we know, for example, whether people like Andrew Marr or Andrew Neil are not also hiding money in these offshore accounts?

  • nigel hunter 10th Apr '16 - 11:24pm

    I would like to know what Boris has! and Nigel Farage! Yes the Norwegian system should be adopted for I believe that being open ‘crooks’ cannot hide their money. It could be put to a parliamentary vote.

  • This has been a useful exercise in Cameron bashing and Ton Hill, as ever, provides a balanced comment. The exercise is useful if it results in closing the tax avoiding boltholes provided by British dependencies. Castigating Toffs like Cameron is good sport but those of us who are on his side against the Brexit nasties regard it as a silly diversion!

  • Jayne Mansfield 11th Apr '16 - 1:58pm

    @ Alan Jelfs,
    I agree.

  • @tonyhill
    You will no doubt be pleased to know that the Mail has stopped being hypocritical, as you se it, and today published a full-page editorial praising Cameron for his efforts at avoiding inheritance tax and urging him to let rich people avoid all inheritance tax in the future. (Anybody who believes in such concepts as “equality of opportunity” and rejects the idea of trickle-down economics will find the following a truly nauseating read: )

    “the £200,000 given to Cameron by his mother under the seven year rule which is a perfectly legitimate thing to do (and not, in my view, in any respect comparable to the aggressive tax avoidance of the Jimmy Carr scheme to which you allude)”

    It’s legitimate in the sense of perfectly legal, but whether it’s much different morally from the Jimmy Carr scheme is entirely subjective. Actually I think it IS very comparable, for the simple reason that it’s a tax-avoiding measure which appears to be open only to the rich who have huge amounts of cash lying around, moreover it’s a method only available to the rich who are able to leave their money to a spouse in the first instance.

  • Jayne Mansfield 11th Apr '16 - 6:55pm

    ‘ Taxation remains a private matter’. Why?

    I hope that this is not an exercise in ‘short term politicking ‘, but an an opportunity to shine a light on something that is manifestly unfair and really rather darker.

    I would be more than happy to disclose how much I pay in tax. Why would some be less happy?

  • @Stuart ” Actually I think it IS very comparable, for the simple reason that it’s a tax-avoiding measure which appears to be open only to the rich who have huge amounts of cash lying around, moreover it’s a method only available to the rich who are able to leave their money to a spouse in the first instance.”

    Strange idea, the facility for parents to gift monies to their children have no means tested threshold. Hence any one can take advantage of their annual exemption…

    Actually by your logic, we should be taxing the ‘very’ poor at 45% because this tax rate is only available to the ‘very rich’…

  • David Evans 12th Apr '16 - 8:59am

    Somehow Roland I think it might have helped if you had chosen a slightly less silly example to counter Stuart’s point.

  • Diane Reddell 12th Apr '16 - 12:01pm

    I’m not really bothered that MPs publish their Tax returns or that a rich person has money. I’m more concerned that HMRC is aware of any income that is generated and that the correct amount of tax is collected and that money is not hidden in tax havens. Tax havens and tax avoidance schemes should be abolished.

  • @David Evans – I agree, the example chosen was poor, however, it irritates that many people who are quick to complain about aspects of our taxation system that seem to favour the ‘better off’ – only because they seem to be the one’s with savings, but are blind to those aspects that favour the less well off.

    But then I suspect people like Stuart would also regard the growing number of ISA millionaires as being comparable to people like Jimmy Carr who invested in aggressive tax avoidance schemes…

  • David Evershed 12th Apr '16 - 5:32pm

    The issue at hand is tax avoidance or tax evasion.

    Publishing people’s tax returns does not help because any tax avoided or evaded will not appear on the tax return.

  • Jayne Mansfield 12th Apr '16 - 5:44pm

    @ David Evershed,
    Are you saying that people will not be able to see the disparity between what they say they earn, the tax paid and their lifestyle?

  • @David Evershed – I’m not sure if the issue really was or is tax avoidance or evasion, in the way the UK media have been running with it.

    Remember what kicked this off was David Cameron’s family being named in some of the documents hacked from Mossack Fonseca. However, in the hue and cry over David Cameron, the (UK) press seem to have totally overlooked and forgotten the much more serious evidence of tax evasion and money laundering the papers contained, all of which Mossack Fonseca was able to facilitate due to them being able to draw their lawyer’s client confidentiality cloak over these business activities, which have little to do with representing their clients in court…

  • Roland no one forgot it.
    David Cameron happens to be our prime minister and has forever droned on about fairness and being all in together. That’s why it’s an issue.
    My guess on hearing this stuff the people of Britain were supposed go ” That Putin, he’s a bit unpleasant”. Instead Mr Cameron met with Mr Hubris because Mr Putin’s dodgy finances are not actually terribly relevant to Britain as he is the head honcho of an entirely different country. Contrary to how some would have it, local news is more relevant than international news. But yeah the fact Britain seems to be the biggest player when it comes to “off Shore” money laundering enterprises does deserve more coverage, but that doesn’t let Cameron off the hook, it just makes him look even dodgier.

  • Jayne Mansfield 13th Apr '16 - 7:17am

    @ Roland,
    I am not so sure that the general public, of which I am a member really have.

    Those who wish to defend the unfairness are desperately trying to frame an argument about fairness into one of envy, opposition to aspiration etc. Quelle Surprise!

    Even someone like myself knows that there is tax avoidance (legal), tax evasion (illegal) , but also that there is a vast grey area in between that keeps some lawyers and accountants in what appears to be very shady areas, very busy.

    @Tony Hill,
    I hope that my ISA’s etc., are not in some scheme used by criminals, kleptocrats and money launderers. I would like such schemes closed.

  • @Roland
    “But then I suspect people like Stuart would also regard the growing number of ISA millionaires as being comparable to people like Jimmy Carr who invested in aggressive tax avoidance schemes…”

    Why on earth would I think that? There is no comparison whatsoever between somebody who has invested small annual amounts for 30 years and done well, and somebody who makes a fortune quickly on an aggressive tax avoidance scheme. (Your “growing number” amounts to about 200 very lucky people.)

    The whole point is that – and correct me if I’m wrong here – schemes like the ones Carr and Cameron have profited from are only available to the rich. I’m sure if this were not the case, word would swiftly get around, lots of “ordinary” people would participate, and the government would IMMEDIATELY find ways of clamping down on such schemes.

    It’s this “Leona Helmsley” ethos behind the schemes that people find unfair; the fact that only the rich can exploit them while the rest of us have no choice but to see our taxes sucked from our pay packets. That’s why Cameron felt obliged to condemn Carr in such strong terms, and why he’s now looking like such a hypocrite for doing so.

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