You’re going to purge tax havens, Prime Minister? But Britain is the biggest tax haven of them all

Tricky business, this government thing.

Tricky business, this government thing. You come up with a bright idea, something that will chime with the masses, give good copy and make you look as though you’re on top. Then, when you get down to the nitty-gritty of actually turning your media sound bites into reality, guess what – it’s not quite so simple. Take tax havens, for example.

For years when they were in opposition, Labour used to bang on about what they would do when they got into power.

The world as we knew it, they promised, was going to change. The ‘fat-cat Tory bastards’, as one of their number used to call them (he really did, I can remember him still, working out of the press office, handing out releases, shouting ‘Another Tory fat-cat bastard, read all about it!’), would suffer – we’d see.

High on their agenda were tax havens: those funny places with their quaint customs and obsession with secrecy, where big business and the rich choose to stash their cash. They would soon be history.

Labour duly entered Number 10 – then what? Nothing.

Blitzing offshore tax centres was quietly forgotten amid the other issues clogging up the government’s in-tray.

Until 2007, when private equity fell under the spotlight and a couple of the senior figures in that industry who had already made their fortunes and had nothing to lose, told their colleagues publicly they had to clean up their act – in particular, they had to be more mindful of the fact that many of them paid little tax. All hell duly broke loose.

The Tories climbed aboard the populist bandwagon and called for a push against many of those who worked in private equity, who lived here and enjoyed privileged non-domicile status, meaning they paid tax on their UK (as opposed to worldwide) earnings. David Cameron and his merry crew could say that, because for them it didn’t matter – as with Labour over a decade previously – they weren’t running the country.

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