BBC executives decided to drop a Panorama investigation into Conservative Party donor Michael Ashcroft at the last moment yesterday after new evidence surfaced about his tax affairs.
Ashcroft's tax status has been the subject of much debate ever since he secured a peerage in 2000 by promising to return from Belize and become a UK permanent resident.
Earlier this year, after a decade of "obfuscation and evasion", Ashcroft admitted that he was still a "non-domiciliary" for UK tax purposes.
Commentators (including coalition business secretary Vince Cable) believe Ashcroft avoided paying over £100m in UK tax as a result of being a "non-dom" and likely donated more money to the Conservative Party than he paid tax to HM Revenue & Customs between 2000-2010.
In last night's programme, the BBC reportedly planned to air a show about how Ashcroft avoided paying over £3m in tax in the run-up to the 2010 general election by transferring ownership of company shares into a private trust benefiting his children.
Tax lawyer Richard Frimston told programme-makers: "If that had been done on the following day [i.e., April 6], assets worth say £17m going into trust would have been subject to tax at 20%, which would have created an immediate inheritance tax charge of something in the region of £3.4m." It is unclear, however, how this transfer would have been illegal...
Panorama also planned to report on an investigation by British police into political corruption on the Turks and Caicos islands, specifically a $5m loan made by Ashcroft's British Caribbean Bank to the country's former chief minister Michael Misick.
So why did the BBC pull the programme? Here's the official word from the BBC:
"We put a number of questions to Lord Ashcroft two weeks ago, including one relating to a share interest transfer.
"We asked for a response by Friday 24th September. In a response received this afternoon we have been given information that sheds new light on that issue and we will therefore review the programme."
- Panorama programme on Lord Ashcroft withdrawn by BBC (BBC News)
- Lord Ashcroft investigation pulled by BBC Panorama over legal problems (Guardian)
- Lord Ashcroft 'avoided £3.4m in tax' ahead of rule change (Guardian)
- Belize ignores global tax accord; spotlight turns to Ashcroft (The Solicitor)
- Trust law (Findlaw.co.uk)
- Tax law (Findlaw.co.uk)
- Legal Q&A (Community)
- Find a solicitor (Contact Law)