The ties that bind capitalism

by Daphne Liddle

ONE OF THE many strings that tie elected governments to the ruling class hit the headlines last week as revelations about HSBC bank advising its wealthy clients on how to dodge paying taxes came to light.

This particular scandal has been a slow fuse burning for a long time. The revelations are the result of large quantities of information made available to the international media in 2007 about accounts held in the Swiss branch of HSBC.

The French authorities concluded in 2013 that 99.8 per cent of their citizens on the list were probably evading tax.

The thousands of pages of data from the leak were obtained by the French newspaper Le Monde. In a joint investigation, the documents have now been passed to the International Consortium of Investigative Journalists,

The information covers 106,000 accounts held by rich people from 203 countries and it has set governments in Argentina, the US, France Belgium and India investigating their nationals who are on the list.

The investigations have been slow and cautious. Many on the list throughout the world have been generous donors to political parties, which thanks to this benevolence have had more than their share of electoral success.

Many current government leaders will have been helped to power by this money and are wary to dig too deep too fast.

HM Revenue and Customs (HMRC) was given the leaked data in 2010 and has identified 1,100 people who had not paid their taxes. But almost five years later, only one tax evader has been prosecuted.

Indeed HMRC has a long-standing policy of not prosecuting the biggest tax dodgers but negotiating with them instead and readily accepting a tiny proportion of what is owed as a settlement.

This policy of course was created by the politician pals who have benefitted from patronage of the wealthy tax dodgers.

So although there is now a big outcry in the press and governments are promising to come down hard on tax dodgers, most of them will still be sleeping comfortably in their beds, knowing their chances of being prosecuted are very small.

Not every one of the account holders is a law breaker — but many of them are illegally concealing large amounts of their wealth from the governments they are supposed to pay taxes to.

And it is the HSBC bank that has been helping them and advising them on how to do this — sharing with these elite billionaires the perspective that paying taxes is for poor people and fools.

A total of $118 billion in total is held in these Swiss accounts.

But HSBC is only one of several giant banks and Switzerland is only one of many offshore tax havens. So what has been revealed so far is probably just the tip of a mountain-sized iceberg.

Seven thousand of these dodgy accounts are held by people in Britain and they do include many political donors.

A former Tory treasurer, a current Tory MP and donors to British political parties are among those known to have held Swiss bank accounts with HSBC.

While Labour leader Ed Miliband has accused David Cameron and the Tory party of benefitting from large donations from tax dodgers, Cameron has countered, pointing out that Labour has also had donations from some.

The figures show that Conservatives have raised more than £5 million from HSBC clients with Swiss accounts, while Labour has benefitted from cash and gifts in kind worth well over £500,000 and received a loan for £2 million. The corrupt ruling class definitely favour the Tories.

And the Tories have responded to their donors by making HSBC’s long-serving chief executive and chair Stephen Green a member of the House of Lords and appointed him trade minister — Britain’s chief business representative abroad — following the May 2010 election.

It is hard for Lord Green and for the Tories who made him part of their government to claim they were unaware of the ongoing investigations from the 2007 giant data leak.

It seems they have become brazen and no longer bother to hide their corruption