Tory peer Lord Ashcroft kept William Hague in the dark for years about his controversial tax status, the shadow Foreign Secretary said last night as new details about donations to the party emerged.
In the first sign of the Tory leadership distancing itself from its billionaire deputy chairman, Mr Hague revealed he had only recently learned of a deal that allowed the peer to claim non-dom tax status.
He had previously suggested that Lord Ashcroft's move to become a permanent UK resident would provide “tens of millions a year in tax” to the Treasury.
Lord Ashcroft wrote to Mr Hague, then-Tory leader, in 2000 giving his “clear and unequivocal assurance” he would become a permanent UK resident for tax purposes to take his place in the second chamber. But Mr Hague said he had only found out in “the last few months” that the peer, who has donated millions to the Tories, later renegotiated the deal.
At the time Mr Hague wrote to Tony Blair, then the Prime Minister, reassuring him: “(Lord Ashcroft) is committed to becoming resident. This decision will cost him (and benefit the Treasury) tens of millions a year in tax yet he considers it worthwhile.” He also acknowledged in the note that a decision to block a peerage for Lord Ashcroft in 1999 had been made, in part, because, “Mr Ashcroft was a tax exile”.
But yesterday Mr Hague told the BBC he only recently discovered the deal Lord Ashcroft struck over his tax status.
“Over the last few months I knew about that,” he said. “After that, of course I was very keen to support him in making that position public.”
Last night, some Tories were already interpreting Mr Hague's words as a move to isolate Lord Ashcroft.
Labour’s Douglas Alexander said Lord Ashcroft's position within the Tory party was “completely untenable”.