By establishing an offshore firm – Pandora papers – Tony and Cherie Blair were able to save £312,000.
FORMER It has been revealed that Prime Minister Tony Blair and his wife Cherie saved hundreds of thousands of dollars in property taxes by purchasing a London office building from an offshore corporation that is part-owned by a Bahrani businessman.
After purchasing a firm in the British Virgin Islands held by the family of HE Zayed bin Rashid Alzayani, Bahrain’s minister for industry, commerce, and tourism, the Blairs bought an office building for £6.5 million in 2017.
The Pandora files, a massive collection of leaked offshore documents, outline the agreement.
According to the Guardian, Mr Alzayani is a shareholder of another offshore corporation that has invested more than £60 million in UK commercial property over the last nine years, including the Marylebone address sold to the Blairs.
Because they bought the property’s holding company rather than the building itself, the Blairs were able to avoid paying £312,000 in stamp duty.
The transaction was completely lawful, and there is no evidence that the Blairs were attempting to avoid paying stamp duty in any way.
Nonetheless, the agreement highlights a loophole that allows wealthy landowners to avoid paying fees that less well-off persons must pay.
“It is wrong that if you acquire a company that owns a property, you don’t have to pay stamp duty,” said Robert Palmer, executive director of Tax Justice UK.
“These are loopholes that are open to the wealthy but not to the rest of the population.
“Politicians must reform the tax code to ensure that everyone pays their fair amount.”
Commercial and residential buildings sold for more than £150,000 and £125,000, respectively, are subject to stamp duty.
According to the Nationwide building society, the average price of a house in the UK was £244,229 in July.
“There was nothing strange or underhanded in any of this,” Cherie Blair told the Guardian.
“I did not want to be the owner of a BVI business and so asked my accountants, BDO, and attorneys, Blake Morgan, to ensure that I could repatriate the company and the building to the UK,” she said, adding that the Alzayanis did not want to sell the building separately from their BVI company.
“All of the arrangements were formed with the explicit goal of bringing the firm and the building back into the UK tax and regulatory environment, where they have stayed.”