Charlotte Leslie: Tory MP’s sudden change of heart over tax-avoidance donor

Returning donation could have set costly precedent for Conservatives

Charlotte Leslie MP in the BBC series ‘Inside The Commons’ (PA)

A Tory MP has reversed her pledge to hand back £5,000 from a wealthy donor who tried to avoid paying income tax on his multi-million pound bonus payments – because the scale of what he’d done wasn’t bad enough.

Charlotte Leslie initially said that she would return the donation from Hugh Sloane after she was told that a scheme of which he was a prime beneficiary had been ruled to be designed for avoiding tax.

But hours after her decision became public – and Conservative headquarters were alerted to it – Ms Leslie mysteriously changed her mind.

She said she had been under the impression that Mr Sloane was guilty of tax evasion – which is illegal – rather than a tax-avoidance scheme that had been ruled inadmissible by judges, who ordered gains from it repaid to HM Revenue & Customs (HMRC).

Labour suggested that her change of heart might have had something to do with the fact that the Conservatives have accepted over £600,000 from Mr Sloane since 2004. The party has also accepted a £400,000 donation from George Robinson, another beneficiary of the same aggressive tax-avoidance scheme.

Tory donor Hugh Sloane

If the party had followed Mr Leslie’s example, it would be facing a potential £1m short fall in its election war chest.

Ms Leslie, the MP for Bristol North West, received the personal donation the multi-millionaire co-founder of the investment management company Sloane Robinson, in December.

The Times discovered that the company was ordered to pay £13m in unpaid tax and national-insurance contributions to HMRC in 2012 after a tribunal ruled against a tax scheme that Sloane Robinson had used since 2004.

The crown argued that the share scheme was a “mechanism for delivery of bonuses” of £24m to Mr Sloane, co-founder George Robinson and two other directors.

The tribunal concluded that the structures had been “moneybox companies” that would allow the beneficiaries to avoid paying income tax.

When initially contracted by The Times, Ms Leslie said: “Nobody wants to take money that’s not whiter than white.”

But yesterday she issued a statement saying: “On Sunday I was contacted by a journalist from The Times. I mistakenly understood that Hugh Sloane, who has donated to my campaign, had been found guilty of tax evasion. I indicated that if I had received a donation was from someone who had been found guilty of tax evasion I would return it.

“It is clear this was not tax evasion, and that there was no criminal prosecution of Hugh Sloane ... given this, I will not be returning the donation.”

Conservative MPs Angie Bray and Nicola Blackwood have also accepted £10,000 each in donations from Mr Sloane .

It is understood Ms Bray and Ms Blackwood, both fighting to retain marginal seats at the general election, do not intend to return their donations.

Mr Sloane told The Times that neither he nor Sloane Robinson owes any outstanding tax to HMRC. Ms Leslie declined to comment on her change of mind but a Conservative spokesman said: “All donations to the Conservative party are properly and transparently declared to the Electoral Commission, published by them, and comply fully with Electoral Commission rules.”