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45 Mr David Nuttall (Bury North) (Con): Does my right hon. Friend agree that any course of action designed toreduce tax that does not constitute tax evasion must, by definition, be legal, even if some may regard it as aggressive tax avoidance? It is up to this Parliament to legislate to make such courses of action illegal.

The Prime Minister: My hon. Friend is absolutely right. Where there is aggressive avoidance taking place that is clearly against the spirit of the law, Parliament should act. As I have said many times, that is what the Chancellor has done, and that is what HMRC advises us about. I think that sometimes there are occasions when the tax avoidance is so aggressive that it is right to warn those taking part in it that legislation will follow, and therefore they should not take part in the scheme in the first place. That often happens.

Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP): The Prime Minister has described the tax arrangements being discussed today as standard practice and normal. Assuming we are still all in this together, will he issue guidance—perhaps in the form of a leaflet to every UK household—so ordinary taxpayers can find out how they, too, can benefit from offshore tax havens?

The Prime Minister: The point is that there are many people in our country—I think there are now over 12.5 million shareholders—who hold shares in things such as unit trusts. There is plenty of information about them, and they do not need any from me. The point is that, if you invest in one of those and you are a UK resident, you must pay UK income tax and UK capital gains tax, just as you would if you buy a share in any other organisation.

Robert Jenrick (Newark) (Con): I would not recommend doing this, but, having read back through Hansard over the 13 years of the previous Labour Government, I could not find a single occasion on which the right hon. Member for Islington North (Jeremy Corbyn) raised any of these issues. The closest he came was when he described the Labour Government’s decision to use Orders in Council to take control of the Turks and Caicos Islands as “mediaeval” and “extremely undemocratic”, but he now advocates that policy for all territories. Is it not fortunate that after 2010 we had a Government who actually took up this agenda?

The Prime Minister: I am interested to see that the right hon. Gentleman has conducted a U-turn because recently he has been suggesting taking control of these territories. I can now see a use for the nuclear submarines as they head off towards the Isle of Man, and as the Corbyn invasion force begins to mass to take over this territory. It is much more sensible to get them to do the things they ought to be doing.

Liz Kendall (Leicester West) (Lab): Why does the Prime Minister think so many companies are registered in Panama in the first place, not in London or New York?

The Prime Minister: The reason why a lot of unit trusts register in different countries—a number of them have been named; right now, many of them are registering

in Dublin—is that they want to be able to market their services not simply to UK residents, who pay UK taxes, but to other people. That is why, if we look at the Inland Revenue and the way it arranges this, it actually wants to make sure that UK fund managers can be involved and pay their taxes in the UK, and we can build the investment industry that this country can rightly be proud of.

Andrew Bridgen (North West Leicestershire) (Con): May I thank my right hon. Friend for his open and frank statement today? In the mind of any reasonable person, he has completely exonerated himself. Will he confirm that, under HMRC rules, all supporting documentation for a tax return should be retained for seven years? Since the Leader of the Opposition was late supplying his tax return, should he be fined?

The Prime Minister: There is obviously no fine for the fact that the right hon. Gentleman did not come to the House having already published it, although it was disappointing that we got it at 3.35 pm, when I was on my feet. Obviously, the matter of fines for late production of tax returns is a matter for HMRC.

Paul Flynn (Newport West) (Lab): In 2013, the Prime Minister’s colleague Lord Blencathra was found guilty of an egregious breach of the Commons and Lords rules for misleading a Committee of inquiry in 2011 and for taking £10,000 a month as payment for lobbying for the Cayman Islands. He had no punishment from his party, and was allowed to get away with it, with a brief apology to the House of Lords. Will the Prime Minister tell us whether, if in future any parliamentarian in his party uses and prostitutes his privileged position in order to make a private gain, he will act and discipline them?

The Prime Minister: The point is that we now have rules in the House for the declaration of Members’ interests; we have a policeman, as it were, in terms of making sure that they are properly carried out; and we do have punishments, including expulsion, for misdeclarations and misbehaviour. I am not as familiar with the situation in the House of Lords, but I think it has been moving in the same direction and that is all to the good.

Ben Howlett (Bath) (Con): While the conversations about Panama are no doubt interesting to Opposition Front Benchers, one reality check is that most of my constituents who are struggling to get on to the property ladder actually benefit from inheritance as a result of a lot of the tax changes that happened during the previous Parliament. Does my right hon. Friend agree that now is the time to reform inheritance tax further to help more people, mainly those of my age, to get on to the property ladder?

The Prime Minister: There is a role for making sure that people can pass on the family home exempt from inheritance tax. That is why we have set out steps during this Parliament to make sure that can happen, completing what was set out in our manifesto.

Clive Efford (Eltham) (Lab): The public would be more inclined to take the Prime Minister at his word when he says that he wants to clamp down on tax